WORLD TRADE ORGANIZATION
Panel established pursuant to Article 6 of the
Understanding on Rules and Procedures Governing the Settlement of Disputes
AUSTRALIA – MEASURES AFFECTING THE
IMPORTATION OF APPLES FROM NEW ZEALAND
(DS367)
First Written Submission of Australia
Geneva, 18 July 2008
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Table of Contents
TABLE OF CONTENTS ..............................................................................................................ii
TABLES AND FIGURES ............................................................................................................ ix
LIST OF EXHIBITS ..................................................................................................................... x
CASES CITED IN THIS SUBMISSION ................................................................................... xix
GLOSSARY OF ABBREVIATIONS AND ACRONYMS ...................................................... xxi
GLOSSARY OF SCIENTIFIC TERMS ..................................................................................xxiii
I.
EXECUTIVE SUMMARY ................................................................................................. 27
II.
INTRODUCTION ............................................................................................................... 31
(a) New Zealand has not discharged its burden of proof .............................................. 31
(b) The SPS Agreement is a delicate balance of rights and obligations ........................ 31
(c) Australia’s measures are based on a valid risk assessment ..................................... 32
(d) Australia’s risk assessment is based on objective and credible evaluation of the
evidence ........................................................................................................................... 32
(e) New Zealand erroneously relies on the findings of the Japan-Apples dispute ....... 33
(f)
New Zealand’s allegations of politicisation should be disregarded by the Panel ... 34
III. PROCEDURAL BACKGROUND ..................................................................................... 36
IV. FACTUAL BACKGROUND.............................................................................................. 38
A.
Overview of Australia’s quarantine and biosecurity situation ........................................ 38
1. Australia is free of many of the world’s plant pests and works hard to preserve this
status .................................................................................................................................... 38
2. Australia has particular vulnerabilities to exotic pests .................................................... 39
3. Australia’s biodiversity and agriculture are significant assets ........................................ 39
(a) Australia’s biodiversity is of intrinsic value ............................................................ 39
(b) Australia’s agricultural sector is economically significant...................................... 40
(c) Australia’s apple and pear industry is important ..................................................... 41
B.
Australia’s quarantine system .......................................................................................... 43
1. Australia has a comprehensive and effective quarantine system .................................... 43
2. Australia dedicates significant resources to its quarantine continuum ............................ 43
3. Australia’s quarantine system is based on a strong legal, administrative and
operational framework ......................................................................................................... 45
C.
The Final Import Risk Analysis for Apples from New Zealand ..................................... 46
D.
Pests at issue in this dispute ............................................................................................. 49
1. Fire blight ........................................................................................................................ 49
2. European canker .............................................................................................................. 50
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18 July 2008
3. Apple leafcurling midge .................................................................................................. 50
E.
The methodology applied by the IRA Team ................................................................... 51
1. The IRA Team comprehensively and rigorously assessed likelihood and
consequences to arrive at risk .............................................................................................. 51
2. The IRA Team comprehensively and rigorously evaluated the likelihood of entry,
establishment and spread ..................................................................................................... 52
3. The IRA Team comprehensively and rigorously evaluated consequences ..................... 57
4. The IRA Team concluded that risk mitigation measures were required ......................... 60
V.
LEGAL FRAMEWORK ..................................................................................................... 61
A.
The product at issue in this dispute is mature apples ...................................................... 61
B.
The measures at issue limit the scope of this dispute ...................................................... 62
1. The Panel’s terms of reference are limited to the 17 measures specifically identified
in New Zealand’s panel request........................................................................................... 62
(a) New Zealand disregards the consequences of the Panel’s preliminary ruling ........ 62
(b) New Zealand has not established that all measures are challengeable under the
relevant provisions of the SPS Agreement ....................................................................... 63
2. Australia does not impose the pruning requirement alleged by New Zealand in
respect of European canker.................................................................................................. 63
3. New Zealand cannot challenge some of the “measures at issue” individually ............... 64
4. New Zealand’s description of certain “measures” imposed by Australia is flawed ........ 67
(a) New Zealand has misunderstood the nature of AQIS involvement in orchard
inspections ....................................................................................................................... 67
(b) New Zealand has mischaracterised Australia’s principal requirement in respect
of fire blight ..................................................................................................................... 69
(c) New Zealand has misunderstood the fire blight requirement in respect of
pruning ............................................................................................................................. 70
(d) New Zealand has mischaracterised the European canker requirement in respect
of planting stock .............................................................................................................. 70
5. Conclusion on the measures at issue ............................................................................... 71
C.
The burden of proof is on New Zealand .......................................................................... 71
D.
It is important to apply the appropriate standard(s) of review......................................... 72
1. New Zealand fails to address the crucial issue of standard of review ............................. 72
2. The standard of review is informed by the relevant obligation and covered
agreement............................................................................................................................. 73
3. The standard(s) of review must maintain the balance of rights and obligations under
the SPS Agreement............................................................................................................... 74
4. The SPS Agreement reflects a balance of jurisdictional competences ............................ 75
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18 July 2008
5. The Panel’s role where scientific judgment is not in issue.............................................. 76
6. The standard of review in relation to assessing the scientific basis of SPS measures
evaluated in a risk assessment requires a panel to show considerable deference ................ 77
(a) The mandatory requirement for Members to obtain a risk assessment excludes
a panel from conducting the required risk assessment itself ........................................... 77
(b) Panels should review the risk assessment rather than assess the risk ...................... 78
(c) The Panel may only intervene in the assessment of risk in limited
circumstances................................................................................................................... 79
(d) The Panel should also show considerable deference under the third
requirement of Article 2.2 ............................................................................................... 82
(e) The Panel should also show considerable deference when evaluating whether
alternative SPS measures would achieve Australia’s ALOP ........................................... 83
(f)
The Panel’s right to consult experts cannot extend its role ..................................... 83
7. A panel should also show a degree of deference in assessing a Member’s decision
to adopt SPS measures based on a valid risk assessment .................................................... 84
VI. LEGAL AND FACTUAL REBUTTAL ............................................................................. 86
A.
Article 2.2 and Article 5.1 must “constantly be read together” ....................................... 86
1. New Zealand is wrong to treat Article 2.2 and Article 5.1 in virtual isolation ............... 86
2. Consistency with Article 5.1 establishes consistency with Article 2.2 ........................... 87
B.
New Zealand fails to properly interpret Article 5.1 ......................................................... 92
1. New Zealand does not acknowledge that a risk assessment must be “appropriate to
the circumstances” ............................................................................................................... 92
(a) Risk assessments are “appropriate to the circumstances” if they consider
factors which are relevant to the risk at hand .................................................................. 93
(b) Japan – Apples was a legal, not scientific, process ................................................. 94
2. New Zealand misinterprets the requirement to conduct an “evaluation” of
likelihood under Article 5.1 ................................................................................................. 98
(a) “Probability” and “possibility” are distinct concepts .............................................. 98
(b) New Zealand’s complaint concerning the use of “negligible” likelihoods is
misdirected..................................................................................................................... 100
(c) New Zealand wrongly assumes that “negligible” events should be treated as
ruptures in the pathway.................................................................................................. 101
(d) New Zealand’s argument on “theoretical uncertainty” is baseless ........................ 102
(e) Summary of New Zealand’s flawed arguments on Article 5.1 ............................. 102
3. New Zealand cannot make a prima facie case by conducting its own risk
assessment ......................................................................................................................... 102
4. New Zealand fails to identify flaws in the methodology used by the IRA Team ......... 105
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18 July 2008
C. Australia’s measures are consistent with Article 5.1, and accordingly, with Article
2.2 122
1. The Panel should be guided by the approach in Australia – Salmon (Article 21.5) ...... 122
2. The IRA Team made an objective and credible evaluation of the likelihood of
entry, establishment and spread of the pests, as well as the associated potential
biological and economic consequences ............................................................................. 123
3. Fire blight ...................................................................................................................... 123
(a) New Zealand makes four key errors ...................................................................... 124
(b) The IRA Team’s analysis of the probability of entry is objective and credible .... 133
(c) The IRA Team’s analysis of the probability of establishment and spread is
objective and credible .................................................................................................... 152
(d) The IRA Team’s assessment of the probability of entry, establishment and
spread should not be disturbed ...................................................................................... 164
(e) The IRA Team’s analysis of the potential consequences is objective and
credible .......................................................................................................................... 167
(f) Conclusion: New Zealand fails to discredit the IRA Team’s assessment on fire
blight .............................................................................................................................. 176
4. European canker ............................................................................................................ 177
(a) The IRA Team’s analysis of the probability of entry is objective and credible .... 177
(b) The IRA Team’s analysis of the probability of establishment and spread is
objective and credible .................................................................................................... 198
(c) The IRA Team’s analysis of the potential consequences of European canker is
objective and credible .................................................................................................... 215
(d) Conclusion: New Zealand fails to discredit the IRA Team’s assessment on
European canker ............................................................................................................ 225
5. Apple leafcurling midge ................................................................................................ 226
(a) The IRA Team’s analysis of the probability of entry is objective and credible .... 226
(b) The IRA Team’s analysis of probability of establishment is objective and
credible .......................................................................................................................... 245
(c) The IRA Team’s analysis of probability of spread is objective and credible........ 250
(d) The IRA Team’s analysis of potential consequences is objective and credible .... 254
(e) Conclusion: New Zealand fails to discredit the IRA Team’s assessment on
ALCM ............................................................................................................................ 261
6. The IRA Team made an objective and credible evaluation of the likelihood of
entry, establishment and spread according to the SPS measures which might be
applied ............................................................................................................................... 262
(a) New Zealand has failed to show that any measures not evaluated are SPS
measures ........................................................................................................................ 262
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18 July 2008
(b) The IRA Team correctly evaluated the risk reduction measures ........................... 262
(c) New Zealand’s claims are without basis ............................................................... 264
(d) Conclusion: The IRA Team objectively and credibly evaluated the measures
which reduce risk ........................................................................................................... 267
7. Australia has demonstrated that the Final IRA Report is consistent with Article 5.1
and the third requirement of Article 2.2 ............................................................................ 268
D.
Australia has acted consistently with Article 5.2 .......................................................... 269
1. New Zealand inappropriately seeks to alter the legal obligation ................................... 269
2. The IRA Team took into account available scientific evidence .................................... 270
3. The IRA Team took into account relevant processes and production methods ............ 273
4. The IRA Team took into account relevant inspection, sampling and testing methods . 275
5. The IRA Team took into account the prevalence of specific diseases or pests ............. 276
6. The IRA Team took into account relevant ecological and environmental conditions .. 277
7. Conclusion: New Zealand has failed to demonstrate that Australia has acted
inconsistently with Article 5.2 ........................................................................................... 278
E.
Alternatively, Australia’s measures are nonetheless consistent with Article 2.2 .......... 279
1. New Zealand’s approach to Article 2.2 is confused and inconsistent ........................... 279
2. New Zealand has abandoned is claim in relation to Article 2.2 second requirement .... 280
3. A rational and objective relationship between the SPS measure and the scientific
evidence is required ........................................................................................................... 280
4. Australia’s measures for fire blight are not maintained without sufficient scientific
evidence ............................................................................................................................. 282
5. Australia’s measures for European canker are not maintained without sufficient
scientific evidence ............................................................................................................. 287
6. Australia’s measures for apple leafcurling midge are not maintained without
sufficient scientific evidence ............................................................................................. 290
7. Australia’s general measures are not maintained without sufficient scientific
evidence ............................................................................................................................. 291
8. Conclusion: New Zealand has failed to demonstrate that Australia’s measures are
inconsistent with Article 2.2 .............................................................................................. 294
F.
Australia’s measures are consistent with Article 5.5 ..................................................... 295
1. Australia has had limited time to prepare its defence .................................................... 295
2. New Zealand must satisfy the three distinct elements of Article 5.5 ............................ 295
3. Australia applies a consistent level of protection .......................................................... 296
(a) Australia’s ALOP is consistent with respect to New Zealand apples and
Japanese nashi pears ...................................................................................................... 296
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Australia’s First Written Submission of Australia
18 July 2008
(b) The applied level of protection is a result of the measures applied to the
unrestricted risk ............................................................................................................. 297
(c) There is a lower likelihood of entry, establishment and spread for Japanese
nashi pears compared to New Zealand apples ............................................................... 298
(d) The potential consequences associated with Japanese nashi pears are much
lower compared with New Zealand apples .................................................................... 302
(e) The resulting risk associated with Japanese nashi pears is much lower than the
risk associated with New Zealand apples ...................................................................... 303
(f) The measures applied for Japanese nashi pears demonstrate that Australia’s
ALOP is consistently applied ........................................................................................ 304
(g) Conclusion: New Zealand has failed to establish a distinction in Australia’s
ALOP ............................................................................................................................. 306
4. Australia’s ALOP does not exhibit arbitrary or unjustifiable distinctions in its
treatment of different situations ......................................................................................... 306
5. The application of Australia’s ALOP in different situations does not result in
discrimination or a disguised restriction on international trade. ....................................... 308
(a) New Zealand has failed to distinguish between discrimination and a disguised
restriction on trade ......................................................................................................... 309
(b) Discrimination must be arbitrary or unjustifiable between countries where
identical or similar conditions prevail ........................................................................... 310
(c) There is no disguised restriction on international trade ......................................... 311
(d) The warning signals and additional factors proposed by New Zealand do not
support a finding of discrimination or a disguised restriction on trade ......................... 311
6. Conclusion: New Zealand has failed to demonstrate that Australia applies its ALOP
inconsistently with Article 5.5 ........................................................................................... 315
G. New Zealand has abandoned its claim under Article 2.3 .............................................. 315
H. Australia’s measures are consistent with Article 5.6 ..................................................... 316
1. New Zealand must satisfy the three distinct elements of Article 5.6 ............................ 316
(a) Any alternative measure must meet the importing Member’s ALOP ................... 317
(b) Any alternative measure must be reasonably available, taking into account
technical and economic feasibility ................................................................................ 317
(c) Any alternative measure must be significantly less restrictive to trade ................. 317
2. The alternative measures identified by New Zealand for fire blight and European
canker would not achieve Australia’s ALOP .................................................................... 318
3. The alternative measure identified by New Zealand for apple leafcurling midge
would not achieve Australia’s ALOP or be significantly less trade restrictive ................. 320
(a) New Zealand’s alternative measure would not achieve Australia’s ALOP .......... 321
(b) New Zealand’s alternative measure would not be significantly less traderestrictive ....................................................................................................................... 323
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Australia’s First Written Submission of Australia
18 July 2008
4. New Zealand has not identified any alternatives to the general measures .................... 325
5. Conclusion: New Zealand has failed to demonstrate that Australia’s measures are
inconsistent with Article 5.6 .............................................................................................. 327
6. New Zealand has abandoned its claim under the first requirement of Article 2.2 ........ 327
I. New Zealand’s claim that the IRA process is inconsistent with Article 8 and Annex
C(1)(a) falls outside the Panel’s terms of reference .............................................................. 329
1. New Zealand has disregarded the Panel’s preliminary ruling ....................................... 329
2. In any event, New Zealand’s panel request does not refer to the “IRA process” ......... 330
3. New Zealand has not made a case of undue delay in relation to any of the measures
at issue ............................................................................................................................... 330
4. New Zealand’s factual allegations are therefore irrelevant ........................................... 330
5. Conclusion: New Zealand has not made a case under Article 8 and Annex C(1)(a) .... 331
VII. CONCLUSION ................................................................................................................. 331
ANNEX 1 TIMELINE FOR THE NEW ZEALAND APPLES IRA PROCESS ............ 332
ANNEX 2 AUSTRALIA’S REVIEW OF ANNEX 3 OF NEW ZEALAND'S FIRST
WRITTEN SUBMISSION ...................................................................................................... 337
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Australia’s First Written Submission of Australia
18 July 2008
Tables and Figures
TABLES
TABLE 1: EVOLUTION OF IRA TEAM’S PROPOSED MEASURES FOR FIRE BLIGHT ...........................48
TABLE 2: RISK ESTIMATION MATRIX USED BY THE IRA TEAM ......................................................59
TABLE 3: BIOSECURITY NEW ZEALAND’S DESCRIPTION FOR CRITICAL ATTRIBUTES OF RISK ........103
TABLE 4: RESULTS OF STUDIES TESTING FOR THE PRESENCE OF E. AMYLOVORA ..........................140
TABLE 5: AUSTRALIAN APPLE PRODUCTION 2006-07 ..................................................................170
TABLE 6: NUMBERS OF INFESTED APPLES PREDICTED TO ARRIVE AT ORCHARD WHOLESALERS ....241
FIGURES
FIGURE 1: AUSTRALIA AND NEW ZEALAND APPLE PRICES ............................................................119
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18 July 2008
List of Exhibits
Exhibit
No.
Exhibit Name
AUS-1
Biosecurity Australia (2006) Final Import Risk Analysis for Apples from New
Zealand, Part A, Canberra, November 2006, pp25.
AUS-2
Biosecurity Australia (2006) Final Import Risk Analysis for Apples from New
Zealand, Part B, Canberra, November 2006, pp376.
AUS-3
Biosecurity Australia (2006) Final Import Risk Analysis for Apples from New
Zealand, Part C, Canberra, November 2006, pp197.
AUS-4
Anderton, J. (2008) Third Reading, Biosecurity and Hazardous Substances New
Organisms Legislation Amendment Bill, 3 April 2008, pp2.
AUS-5
Dominion Post (2008) “Sour Taste of Apple Imports”, 31 January 2008.
Federated Farmers (New Zealand) (2007) “Press Release: Honey Imports Must
Stop For Good”, 5 December 2007.
AUS-6
International Plant Protection Convention, International Standard for
Phytosanitary Measures No. 11: Pest risk analysis for quarantine pests including
analysis of environmental risks and living modified organisms, 2004.
AUS-7
Biosecurity New Zealand, Risk Analysis Procedures, Version 1, Wellington, 12
April 2006, pp1, 8, 16, 17, 29, 43, 46, 50, 79.
AUS-8
Department of Internal Affairs New Zealand (2008) "Notice Number: 4582:
Biosecurity (Process for Establishing Independent Review Panel) Notice 2008"
New Zealand Gazette - Te Kahiti o Aotearoa, 26 June 2008, p2765.
AUS-9
Consultancy Agreement For Participation on the Risk Analysis Panel for the
Importation of Apples From New Zealand to Australia (Commonwealth of
Australia and Armour's Apples Pty Ltd), 20 March 2002, pp13, 14, 24.
AUS-10
AUS-11
AUS-12
Biosecurity Australia (2003) Import Risk Analysis Handbook, pp.45.
Diagram of parts of an apple flower and apple fruit.
Diagram of the life cycles of fire blight, European canker and apple leafcurling
midge.
Diagram of importation steps for apple fruit from New Zealand.
International Plant Protection Convention, International Standard for
Phytosanitary Measures No. 14: The use of integrated measures in a systems
approach for pest risk management, 2002.
AUS-13
AUS-14
AUS-15
Biosecurity New Zealand, The Risk Analysis Framework: Delivering to
Expectations, Version 1.3, 23 November 2005, p5.
AUS-16
International Plant Protection Convention (2007) IPPC pest risk analysis course Participant manual, pp1, 36-37.
AUS-17
Biosecurity Australia (2001) Draft Guidelines for Import Risk Analysis, pp25, 83,
89.
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Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Exhibit
No.
Exhibit Name
AUS-18
Biosecurity New Zealand, Importing Countries' Phytosanitary Requirements
(ICPR) Register, including ICPR: Argentina (p12), Chile (p19), India (p16) and
Taiwan (pp28-29).
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AUS-19
Fresh Fruits Company New Zealand (2008) Apple Bytes - New Zealand Apple
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2008.
AUS-20
Pipfruit New Zealand, "Pipfruit Industry in Support of NZ Submission to WTO",
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AUS-21
Innomarc Consulting Project Team (2006) Smarter, Faster, Better – Leading
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pp21-32.
AUS-22
Coles Myer Ltd (2005) Submission to the Agriculture and Food Policy Reference
Group, Department of Agriculture, Fisheries and Forestry, p3.
AUS-23
United States Department of Agriculture Foreign Agricultural Service, "New
Zealand Fresh Deciduous Fruit Annual 2006", GAIN Report Number: NZ6001, 22
December 2005, p6.
AUS-24
Rabobank (2006) "New Zealand Apple Industry – crunch time!" Rabobank Global
Focus, January 2006, pp8.
AUS-25
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AUS-26
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in England" Acta Horticulturae 590, pp61-67.
AUS-27
Northwest Horticultural Council, South Africa.
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AUS-28
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Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
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AUS-30
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AUS-31
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Hale, C.N. and Clark, R.G. (1990) "Detection of Erwinia amylovora from apple
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Australia’s First Written Submission of Australia
18 July 2008
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18 July 2008
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AUS-59
Holmes, R.J. (1993) "Diseases causing post-harvest crop loss of apples and pears:
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AUS-60
AUS-61
Bondoux, P. and Bulit, J. (1959) "Sur la pourriture des pommes due au
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AUS-62
Coles Group’s returnable plastic crate initiative: Coles Group, National Packaging
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AUS-63
United States Department of Agriculture Foreign Agricultural Service, "New
Zealand Fresh Deciduous Fruit Report 2007", GAIN Report Number: NZ7033, 18
December 2007, pp7-8.
AUS-64
Photograph, Photograph of trash coming off a dump tank in a packing house in
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AUS-65
Lolas, M. and Latorre, B.A. (1997) "Effecto Comparativo de Fungicidas en el
control del Cancro Europeo Del Manzano Causado Por Nectria galligena"
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AUS-66
AUS-67
Photographs of Packing Houses near Melbourne, Australia, 2008.
Dubin, H.J. and English, H. (1974) "Factors affecting apple leaf scar infection by
Nectria galligena conidia" Phytopathology 64, pp1201-1203.
AUS-68
Brayford, D., Honda, B.M., Mantiri, F.R. and Samuels G.J. (2004) "Neonectria
and Cylindrocarpon: the Nectria mammoidea group and species lacking
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AUS-69
Hirooka Y., Kobayashi T., Natsuaki K.T. (2005) "Neonectria castaneicola and
Neo. rugulosa in Japan" Mycologia 97(5), 2005, pp1058–1066.
AUS-70
Booth, C. (1959) Studies of Pyrenomycetes: IV Nectria (Part I), 30 December
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xiv
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Exhibit
No.
Exhibit Name
AUS-71
Lortie, M. (1964) "Pathogenisis in cankers caused by Nectria galligena"
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AUS-72
Lacoste, L. and Dehorter, B. (1973) "Mycologie Determinisme de la Reproduction
Sexuee de Nectra Galligena Bres. in Vitro" Annales des Sciences Naturelles
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AUS-73
El-Gholl, N.E., Barnard, E.L., and Schroeder, R.A. (1986) “Homothallism in
Nectria galligena” Canadian Journal of Botony 64, pp902-903.
AUS-74
Kruger, J. (1974) "Zur Genetik von Nectria galligena Bres" Phytopathol, Z 79,
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AUS-75
Plante, F., Hamelin, R.C. and Bernier, L. (2002) "A comparative study of genetic
diversity of populations of Nectria galligena and N. coccinea var. faginata in
North America" Mycol. Res. 106, pp183-193.
AUS-76
Swinburne, T.R. (1971b) "The seasonal release of spores of Nectria galligena
from apple cankers in Northern Ireland" Annals of Applied Biology 69, pp97-104.
AUS-77
McCracken, A.R., Berrie, A., Barbara, D.J., Locke, T., Cooke, L.R., Phelps, K.,
Swinburne, T.R., Brown, A.E., Ellerker, B. and Langrell, S.R.H. (2003b) "Relative
significance of nursery infections and orchard inoculum in the development and
spread of apple canker (Nectria galligena) in young orchards" Plant Pathology 52
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AUS-78
Cooke, L.R. (2003) "Nectria galligena (European canker): Questions for Drs. A.
Berrie & L. Cooke: Responses from Drs. L. Cooke & A. McCracken" E-mail
communication with Biosecurity Australia, May 2003, pp3.
AUS-79
Braun, P.G. (1997) "Distribution and severity of anthracnose canker and European
canker of apple in Kings County, Nova Scotia" Canadian Journal of Plant
Pathology 19, pp78-82.
AUS-80
Manaaki Whenua Landcare Research, NZFUNGI - New Zealand Fungi (and
Bacteria): Collection details for PDD 31850, 32629, 32509, 32502, 32495, 30639
and 32679.All available from:
http://nzfungi.landcareresearch.co.nz/html/data_collections.asp?ID=&NAMEPKe
y=12911
AUS-81
Lolas, M. and Latorre, B.A. (1996) "Importancia y control del cancro europeo del
manzano" Rev.Fruiticola (Chile) 17, pp23-27 (English translation also included).
AUS-82
Hawkes Bay Emergency Management Group, Pest or Diseases affecting
Agriculture, Forestry or Horticulture, 2006.
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7_.html
Accessed: 13 July 2008.
xv
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Exhibit
No.
Exhibit Name
AUS-83
HortWatch (2002) Post-harvest Clean Up Sprays.
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Accessed 12 July 2008.
AUS-84
Commonwealth Agricultural Bureaux International (2003) Crop Protection
Compendium - Global Module, CAB International.
Website: http://www.cabi.org/compendia.asp
AUS-85
Cooke, L.R. (1999) "The influence of fungicide sprays on infection of apple cv.
Bramley's seedling by Nectria galligena" European Journal of Plant Pathology
105, pp783-790.
AUS-86
City of Melbourne (2005) "Tree management/replacement program, impact and
implications" Planning and Environment Committee Report, 31 May 2005.
AUS-87
National Trust of Australia (2008) Royal Exhibition Building.
Website:
http://www.nattrust.com.au/trust_register/search_the_register/royal_exhibition_bui
lding
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AUS-88
Stewart, T.M. and Mumford, J. (1995) "Pest and disease management in Hawke's
Bay, New Zealand apple orchards: results of an "advice-givers" survey" New
Zealand Journal of Crop and Horticultural Science, 1995, Vol. 23, pp257-265.
AUS-89
Tomkins, A.R. (1998) "Apple leaf-curling midge life cycle." The Horticulture and
Food Research Institute of New Zealand Ltd, HortFACT, pp3.
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Accessed 2 November 2005.
AUS-90
Pipfruit New Zealand (2005) Email correspondence sent from Pipfruit New
Zealand to Biosecurity Australia, 3 August 2005.
AUS-91
Australian Bureau of Statistics, “2006-2007 Agricultural Survey, Apples and
Pears”, 7121.0.55.002, 18 December 2007, p1, 3-6.
AUS-92
Tomkins, A.R., Bradley, S.J., Walker, J.T.S., Gibbs, A.R., Marshall, R., Shaw,
P.W., Thomson, C., Burnip, G., Wearing, C.H. and Wilson, D.J. (2006) "Spring
emergence of apple leafcurling midge in New Zealand" Unpublished paper
provided by Ministry of Agriculture and Forestry New Zealand, 2pp.
AUS-93
Australian Quarantine and Inspection Service (2008) Australia-New Zealand
Bilateral Quarantine Arrangement (BQA) Systems Operation Manual (SOM) 7,
Canberra, February 2008, pp155.
AUS-94
Interstate Plant Health Regulation Working Group (1996) The Standing Committee
on Agriculture and Resource Management Code of Practice for Management of
Queensland Fruit Fly, September/October, sections 3-4.
xvi
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Exhibit
No.
Exhibit Name
AUS-95
HortResearch (1999b) “Apple leafcurling midge” in: BugKey; Insects and mites of
pipfruit and stonefruit.
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Accessed 31 May 2004.
AUS-96
Cross, J. (2005) Personal communication from Jerry Cross of East Malling
Research, Kent, UK on apple leaf curling midge, 30 March 2005, pp2.
AUS-97
Courtney, P. (2005) "Scientist battles lettuce aphid" Landline, Australian
Broadcasting Corporation, 30 October 2005.
Website: http://www.abc.net.au/landline/content/2005/s1493620.htm
Accessed: 13 July 2008.
ABC Rural News (2004) "Current-lettuce aphid origin determined", Australian
Broadcasting Corporation, 18 August 2004.
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Accessed: 12 July 2008.
AUS-98
Aukema, B., Bruers, J.M. & Viskens, G. (2005) “A New Zealand endemic Nysius
established in the Netherlands and Belgium (Heteroptera: Lygaeidae)" Belgian
Journal of Entomology 7, pp37-43.
AUS-99
Australian Quarantine and Inspection Service (2008) Data extracted from the
AQIS Pest and Disease Interception Database and provided by the Senior
Entomologist, AQIS Operational Science Program.
AUS-100
European and Mediterranean Plant Protection Organization (2006), “First report of
Nysius huttoni in the Netherlands and Belgium: addition to the EPPO Alert List”
EPPO RS 2006/030, February 2006, pp1-23.
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Accessed 9 July 2008.
AUS-101
Smith, J.T. and Chapman, R.B. (1995) "A survey of apple leafcurling midge
(Dasyneura mali) in the Nelson District" Proceedings of the 48th New Zealand
Plant Protection Conference,pp117-120.
AUS-102
United States Department of Agriculture (2008) Fresh Fruits and Vegetable
Import Manual, June 2008, pp2-36, 2-37, 2-49, 3-216, 3-217.
AUS-103
Harris, M.O., Foster, S.P., Agee, K. and Dhana, S. (1996) "Sex pheromone
communication in the apple leafcurling midge (Dasineura mali)" Proceedings of
the 49th New Zealand Plant Protection Conference, pp52-58.
AUS-104
AUS-105
Anonymous (2002) Fruit and vegetables. Methods and procedures, pp241, 292.
Murdoch, H. (2002) "Apple disease spreads", The Nelson Mail, 27 August 2002,
p1.
xvii
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Exhibit
No.
Exhibit Name
AUS-106
Wilton, J. (2002b) "Recognising European canker symptoms" Fencepost.com.
Website:
http://www.fencepost.com/horticulture/expert/detail.jhtml?ElementID=/content/ne
ws/reposito
ry/20020909_163544_Recognising_European_Canker_Symptoms.xml. Accessed:
7 April 2003.
Lovelidge, B. (2003) "Closing in on canker" Grower 139 (3), pp22-23.
Biosecurity Australia (2003) Review of the Australian Requirement for Petal
Testing and Flower Cluster Examination at Blossoming for Pome Fruit from
Japan, The Republic of Korea and The People’s Republic of China, pp76.
AUS-107
AUS-108
AUS-109
Department of Primary Industries and Energy (1989) Quarantine Circular
Memorandum (Plants) 1989/34: Importation of Nashi Pears from Japan, 11 May
1989, pp4.
AUS-110
Ministry of Agriculture, Forestry and Fisheries of Japan (2003) Report on Free
Status of the Bacterial Shoot Blight of Pear in Japan, 28 March 2003.
AUS-111
Department of Primary Industries and Energy (1989) Quarantine Circular
memorandum (Plants) 1989/63: Fourth Australia – Japan Plant Quarantine
Technical Discussions: 25-26 July 1989, 15 September 1989, pp4.
AUS-112
Australian Quarantine and Inspection Service (1998) Final Import Risk Analysis of
the New Zealand Request for the Access of Apples (Malus pumila Miller var.
domestica Schneider) into Australia, p27.
AUS-113
Australian Quarantine and Inspection Service, Summary of Import Statistics for
nashi pears from Japan, 1996-2003.
AUS-114
Maxson-Stein K., McGhee G.C., Smith J.J., Jones A.L. and Sundin G.W. (2003)
"Genetic Analysis of a Pathogenic Erwinia sp. Isolated from Pear in Japan"
Phytopathology 93, pp1393-1399.
AUS-115
Jones, A.L. and Aldwinckle, H.S. (1990) "Compendium of Apple and Pear
Diseases" The American Phytopathological Society, St. Paul, Minnesota, p32.
AUS-116
Commonwealth Agricultural Bureaux International (CABI), Crop Protection
Compendium: Monilinia fructicola; Monilinia laxa, 2007 Edition.
xviii
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Cases cited in this submission
Short Title
Full Case Title and Citation
Argentina – Footwear (EC)
Appellate Body Report, Argentina – Safeguard Measures on Imports of
Footwear, WT/DS121/AB/R, adopted 12 January 2000, DSR 2000:I, 515
Australia – Salmon
Appellate Body Report, Australia – Measures Affecting Importation of Salmon,
WT/DS18/AB/R, adopted 6 November 1998, DSR 1998:VIII, 3327
Australia – Salmon
Panel Report, Australia – Measures Affecting Importation of Salmon,
WT/DS18/R and Corr.1, adopted 6 November 1998, as modified by Appellate
Body Report, WT/DS18/AB/R, DSR 1998:VIII, 3407
Australia – Salmon
(Article 21.5 – Canada)
Panel Report, Australia – Measures Affecting Importation of Salmon – Recourse
to Article 21.5 of the DSU by Canada, WT/DS18/RW, adopted 20 March 2000,
DSR 2000:IV, 2031
Canada – Dairy
(Article 21.5 – New Zealand
and US II)
Appellate Body Report, Canada – Measures Affecting the Importation of Milk
and the Exportation of Dairy Products – Second Recourse to Article 21.5 of the
DSU by New Zealand and the United States, WT/DS103/AB/RW2,
WT/DS113/AB/RW2, adopted 17 January 2003, DSR 2003:I, 213
Canada – Continued
Suspension
Panel Report, Canada – Continued Suspension of Obligations in the EC –
Hormones Dispute WT/DS321/R, circulated 31 March 2008
EC – Biotech Products
Panel Report, European Communities – Measures Affecting the Approval and
Marketing of Biotech Products, WT/DS291/R, WT/DS292/R, WT/DS293/R,
Corr.1 and Add.1, 2, 3, 4, 5, 6, 7, 8 and 9, adopted 21 November 2006
EC – Asbestos
Appellate Body Report, European Communities – Measures Affecting Asbestos
and Asbestos-Containing Products, WT/DS135/AB/R, adopted 5 April 2001,
DSR 2001:VII, 3243
EC – Asbestos
Panel Report, European Communities – Measures Affecting Asbestos and
Asbestos-Containing Products, WT/DS135/R and Add.1, adopted 5 April 2001,
as modified by Appellate Body Report, WT/DS135/AB/R, DSR 2001:VIII, 3305
EC – Hormones
Appellate Body Report, EC Measures Concerning Meat and Meat Products
(Hormones), WT/DS26/AB/R, WT/DS48/AB/R, adopted 13 February 1998,
DSR 1998:I, 135
EC – Hormones (Canada)
Panel Report, EC Measures Concerning Meat and Meat Products (Hormones),
Complaint by Canada, WT/DS48/R/CAN, adopted 13 February 1998, as
modified by Appellate Body Report, WT/DS26/AB/R, WT/DS48/AB/R,
DSR 1998:II, 235
EC – Hormones (US)
Panel Report, EC Measures Concerning Meat and Meat Products (Hormones),
Complaint by the United States, WT/DS26/R/USA, adopted 13 February 1998, as
modified by Appellate Body Report, WT/DS26/AB/R, WT/DS48/AB/R,
DSR 1998:III, 699
Japan – Agricultural
Products II
Appellate Body Report, Japan – Measures Affecting Agricultural Products,
WT/DS76/AB/R, adopted 19 March 1999, DSR 1999:I, 277
Japan – Agricultural
Products II
Panel Report, Japan – Measures Affecting Agricultural Products, WT/DS76/R,
adopted 19 March 1999, as modified by Appellate Body Report, WT/DS76/AB/R,
DSR 1999:I, 315
Japan – Apples
Appellate Body Report, Japan - Measures Affecting the Importation of Apples,
WT/DS245/AB/R, adopted 10 December 2003, DSR 2003:IX, 4391
xix
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Short Title
Full Case Title and Citation
Japan – Apples
Panel Report, Japan – Measures Affecting the Importation of Apples,
WT/DS245/R, adopted 10 December 2003, upheld by Appellate Body Report,
WT/DS245/AB/R, DSR 2003:IX, 4481
Japan – Apples
(Article 21.5 – US)
Panel Report, Japan – Measures Affecting the Importation of Apples – Recourse
to Article 21.5 of the DSU by the United States, WT/DS245/RW, adopted 20 July
2005, DSR 2005:XVI, 7911
Japan – DRAMs (Korea)
Panel Report, Japan – Countervailing Duties on Dynamic Random Access
Memories from Korea, WT/DS336/R, adopted 17 December 2007, as modified
by Appellate Body Report, WT/DS336/AB/R
US – Cotton Yarn
Appellate Body Report, United States – Transitional Safeguard Measure on
Combed Cotton Yarn from Pakistan, WT/DS192/AB/R, adopted 5 November
2001, DSR 2001:XII, 6027
US – Countervailing Duty
Investigation on DRAMS
Appellate Body Report, United States – Countervailing Duty Investigation on
Dynamic Random Access Memory Semiconductors (DRAMS) from Korea,
WT/DS296/AB/R, adopted 20 July 2005, DSR 2005:XVI, 8131
US – Export Restraints
Panel Report, United States – Measures Treating Exports Restraints as
Subsidies, WT/DS194/R and Corr.2, adopted 23 August 2001, DSR 2001:XI,
5767
US – Gambling
Appellate Body Report, United States – Measures Affecting the Cross-Border
Supply of Gambling and Betting Services, WT/DS285/AB/R and Corr.1,
adopted 20 April 2005, DSR 2005:XII, 5663
US – Hot-Rolled Steel
Appellate Body Report, United States – Anti-Dumping Measures on Certain
Hot-Rolled Steel Products from Japan, WT/DS184/AB/R, adopted 23 August
2001, DSR 2001:X, 4697
US – Lamb
Appellate Body Report, United States – Safeguard Measures on Imports of Fresh,
Chilled or Frozen Lamb Meat from New Zealand and Australia,
WT/DS177/AB/R, WT/DS178/AB/R, adopted 16 May 2001, DSR 2001:IX, 4051
US – Softwood Lumber VI
(Article 21.5 – Canada)
Appellate Body Report, United States – Investigation of the International Trade
Commission in Softwood Lumber from Canada – Recourse to Article 21.5 of the
DSU by Canada, WT/DS277/AB/RW and Corr.1, adopted 9 May 2006
US – Wool Shirts and Blouses
Appellate Body Report, United States – Measure Affecting Imports of Woven
Wool Shirts and Blouses from India, WT/DS33/AB/R and Corr.1, adopted
23 May 1997, DSR 1997:I, 323
US – Continued Suspension
Panel Report, United States – Continued Suspension of Obligations in the EC –
Hormones Dispute WT/DS320R, circulated 31 March 2008
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Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Glossary of Abbreviations and Acronyms
ABARE
Australian Bureau of Agricultural and Resource Economics
ABS
Australian Bureau of Statistics
ALCM
apple leafcurling midge
ALOP
appropriate level of sanitary or phytosanitary protection
APAL
Apple & Pear Australia Limited
AQIS
Australian Quarantine and Inspection Service
BA
Biosecurity Australia, an operating group within the Australian
Government Department of Agriculture, Fisheries and Forestry
BRS
Bureau of Rural Sciences
BNZ
Biosecurity New Zealand, Ministry of Agriculture and Forestry
CSIRO
Commonwealth Scientific and Industrial Research Organisation
DAFF
Department of Agriculture, Fisheries and Forestry (formerly
Agriculture, Fisheries and Forestry - Australia)
DSB
Dispute Settlement Body
DSU
Understanding on Rules and Procedures Governing the Settlement of
Disputes
ESG
Eminent Scientists Group
FAO
Food and Agriculture Organization of the United Nations
Final IRA Report
Final Import Risk Analysis Report for Apples from New Zealand,
November 2006
HortResearch
Horticulture and Food Research Institute of New Zealand Ltd
IPPC
International Plant Protection Convention (as amended)
IRA
import risk analysis
ISPM
International Standards for Phytosanitary Measures
MAFNZ
Ministry of Agriculture and Forestry, New Zealand; New Zealand’s
National Plant Protection Organization
OIE
Office International des Epizooties
PEES
probability of entry, establishment and spread
ppm
parts per million
PRA
pest risk analysis; the process of evaluating biological or other
scientific evidence to determine whether a pest should be regulated
and the strength of any phytosanitary measures to be taken against it
SOP
standard operating procedures
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18 July 2008
SPS Agreement
Agreement on the Application of Sanitary and Phytosanitary
Measures
USDA
United States Department of Agriculture
APHIS
Animal and Plant Health Inspection Service, United States
Department of Agriculture
VBNC
viable but non-culturable
WTO
World Trade Organization
WTO Agreement
Marrakesh Agreement Establishing the World Trade Organization
xxii
Australia – Apples (DS367)
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18 July 2008
Glossary of Scientific Terms
The terms provided in this glossary are representative of their usage in this submission only.
Some terms – particularly those of a biological nature – may have alternative uses outside of the
context of this document.
Amenity plant
Any plant located in a public place, or intended for public usage
Area
An officially defined country, part of a country or all or parts of
several countries (ISPM 5)
Arthropod
The largest phylum of animals, including the insects, arachnids and
crustaceans
Ascospore
A sexual spore produced in an ascus
Biological control
Also ‘biocontrol’ – a method of controlling pests and diseases in
agricultural production that relies on the use of natural predators rather
than chemical agents
Block
An identifiable sub-area of an orchard
Calyx
A collective term referring to all of the sepals in a flower
Canker
General term for a large number of different plant diseases
characterised by the appearance of small areas of dead tissue
Consignment
The apples covered by one phytosanitary certificate shipped via one
port in New Zealand to a designated port in Australia
An organism responsible for transferring a chemical or other
substance from one site to another
Contaminant
Control (of a pest)
Suppression, containment or eradication of a pest population (ISPM 5)
Cultivar
A cultivated plant selection that can be propagated reliably in a
prescribed manner
Deciduous plant
Plants, principally trees and shrubs, that lose their foliage for part of
the year
Diapause
Period of suspended development/growth occurring in some insects,
in which metabolism is decreased
Endangered area
An area where ecological factors favour the establishment of a pest
whose presence in the area will result in economically important loss
(ISPM 5)
Endemic
Belonging to, native to, or prevalent in a particular geography, area or
environment
Endophytic (of a pest)
Describes the endophytic (internal) colonisation (infection) of the core
of an apple or the plant itself, and is generally associated with the
development of disease symptoms
Entry (of a pest)
Movement of a pest into an area where it is not yet present, or present
but not widely distributed and being officially controlled (ISPM 5)
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18 July 2008
Epidemiology
The study of factors influencing the initiation, development and
spread of infectious disease; the study of disease in populations of
plants
Epiphytic (of a pest)
Describes the epiphytic colonisation (infestation) of the surface, calyx
and stem-end of apple fruit, although the fruit and plant is unlikely to
display disease symptoms
Establishment (of a
pest)
The perpetuation, for the foreseeable future, of a pest within an area
after entry (ISPM 5)
Establishment
potential
Likelihood of the establishment of a pest
Exposure group
A category of susceptible host plants for which the likelihood of
exposure, or the impact of a pest, are likely to be meaningfully
different. Exposure groups in this analysis include: commercial fruit
crops; nursery plants; household and garden plants, including weed
species; and, wild (native and introduced) and amenity plants
including susceptible plants growing on farmland
Fruitlet
A very small fruit soon after formation
Fumigation
A method of pest control that completely fills an area with gaseous
pesticides to suffocate or poison the pests within
Herbivore
An organism that feeds primarily upon plants.
Host
An organism that harbours a parasite, mutual partner, or commensal
partner, typically providing nourishment and shelter.
Host range
The collection of hosts that an organism can utilise as a partner or
parasite.
Hypanthium
A bowl-shaped part of a flower consisting of the bottoms of the
sepals, petals and stamens stuck together. It is present in all members
of the Rosaceae (rose) family
Infection
The internal ‘endophytic’ colonisation of a plant, or plant organ, and
is generally associated with the development of disease symptoms as
the integrity of cells and/or biological processes are disrupted
Infestation
The ‘epiphytic’ colonisation of the surface of a plant, or plant organ,
and is characterised by the absence of disease symptoms
Inoculum
Pathogen or its parts, capable of causing infection when transferred to
a favourable location
Introduction (of a pest) The entry of a pest, resulting in its establishment (ISPM 5)
Larva
A juvenile form of animal with indirect development, undergoing
metamorphosis (for example, insects or amphibians)
Lenticel
A small oval/rounded spot on the stem or branch of a plant, from
which the underlying tissues may protrude or roots may issue, either
in the air, or more commonly when the stem or branch is covering
with water or earth.
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Australia – Apples (DS367)
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18 July 2008
Lot
All apple fruit packed for export to Australia each day by a registered
packing house
Mature fruit
Commercial maturity is the start of the ripening process. The ripening
process will then continue and provide a product that is consumer–
acceptable. Maturity assessments include colour, starch index, soluble
solids content, flesh firmness, acidity, and ethylene production rate
Midge
A small two-winged insect belonging to the Order Diptera
Mite
An arthropod belonging to the Order Acarina (mites and ticks)
Mortality
The total number of organisms killed by a particular disease
Official
Established, authorised or performed by a National Plant Protection
Organization (ISPM 5)
Orchard
Organophosphate
A contiguous area of apple trees operated as a single entity
A soluble fertiliser material consisting of organic phosphate esters
(glucose, glycol, etc.)
Parasitoid
An insect parasitic only in its immature stages, killing its host in the
process of its development, and free living as an adult (ISPM 5)
Pathogen
A biological agent that can cause disease to its host
Pathway
Any means that allows the entry or spread of a pest (ISPM 5)
Pedicel
The stalk of a flower
Peduncle
A flower stalk, or stem
Perithecium
(pl: perithecia) A flask or jug-shaped fungal fruiting body that is
slightly open at one end
Pest
The collective term used for insect pests, plant diseases, viruses,
bacteria and fungi that could harm plants. The formal definition used
is the one provided in the International Plant Protection Convention
(IPPC): any species, strain, or biotype of plant, animal or pathogenic
agent injurious to plants of plant products
Pest Free Area
An area in which a specific pest does not occur as demonstrated by
scientific evidence and in which, where appropriate, this condition is
being officially maintained (ISPM 5)
Pheromone
Any chemical produced by a living organism that transmits a message
to other members of the same species
Phytosanitary measure
Any legislation, regulation or official procedure having the purpose to
prevent the introduction and/or spread of quarantine pests, or to limit
the economic impact of regulated non-quarantine pests (ISPM 5)
Pome fruit
A type of fruit produced by flowering plants in the subfamily
Maloideae of the Family Rosaceae
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Australia’s First Written Submission of Australia
18 July 2008
Pupa
(Pl: Pupae) An inactive life stage that only occurs in insects that
undergo complete metamorphosis, for example butterflies and moths
(Lepidoptera), beetles (Coleoptera) and bees, wasps and ants
(Hymenoptera)
Quarantine pest
A pest of potential economic importance to the area endangered
thereby and not yet present there, or present but not widely distributed
and being officially controlled (ISPM 5)
Quiescent
Inactive, latent, or dormant, referring to a disease or pathological
process
Rootstock
A stump with an established healthy root system, onto which a tree
part (scion) with fruiting properties desired by the propagator, during
the process of plant propagation by mechanical grafting
Spread (of a pest)
Expansion of the geographical distribution of a pest within an area
(ISPM 5)
Stakeholders
Government agencies, individuals, community or industry groups or
organisations, whether in Australia or overseas, including the
proponent/applicant for a specific proposal, having an interest in the
subject matter of an IRA
Stigma
A part of the female organ of a flower, essentially the terminal part of
a pistil
Symptomless
Without any visible indication of disease by reaction of the host,
e.g. canker, leaf spot, wilt
Trash
Soil, splinters, twigs, leaves and other plant material, other than fruit
stalks.
Utility points
The five key points at which apples are distributed or utilised and at
which apple waste will be generated: orchard wholesalers; urban
wholesalers; retailers; food services; and, consumers
Vector
An organism that does not cause disease itself, but which causes
infection by conveying pathogens from one host to another
Viable
Alive, able to germinate or capable of growth
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Australia’s First Written Submission of Australia
18 July 2008
I.
EXECUTIVE SUMMARY
1.
Australia opened its market to New Zealand apples in 2007. This followed an extensive
import risk analysis which determined that a number of measures were required to mitigate the
real risk that the causal agents of fire blight and European canker, and apple leafcurling midge
(ALCM), could enter Australia with serious and irreversible consequences.
2.
In taking this dispute, New Zealand bears the burden of proof to establish that each of the
challenged measures is inconsistent with each of the SPS Agreement obligations cited in the
panel request.
New Zealand’s submission makes flawed legal arguments and bald, and
sometimes misleading, assertions but without hard evidence to back them up. These failings
mean that New Zealand has not discharged its burden of proof and Australia is therefore entitled
to the presumption that its measures are WTO-consistent. Australia has nonetheless positively
demonstrated in this submission through solid scientific evidence and legal argument that its
measures are fully consistent with the SPS Agreement. While New Zealand is entitled to rebut
Australia’s arguments, it is not entitled to introduce new evidence at a later stage in these
proceedings just because the evidence it currently relies upon is fundamentally lacking.
3.
Australia’s risk management measures are consistent with Articles 5.1 and, it follows,
Article 2.2 of the SPS Agreement. They are based on a comprehensive risk assessment (the Final
IRA Report) which expresses the conclusions of qualified and respected scientists and technical
experts (the IRA Team) which are appropriate to Australia’s circumstances. The IRA Team
concluded on the basis of available scientific evidence that in order to meet Australia’s
appropriate level of protection (ALOP), certain measures were necessary to protect plant life and
health from debilitating pests and diseases not present in Australia but endemic to New Zealand.
New Zealand wrongly claims there are flaws in the methodology used by the IRA Team.
Australia will show that the IRA Team adopted a thorough methodology in assessing risk which
is scrupulously detailed in the Final IRA Report. Its approach was commensurate with best
practice risk assessments worldwide, including the International Plant Protection Convention
(IPPC) standards.
4.
New Zealand’s characterisation of the scientific evidence considered by the IRA Team is
often selective and based on erroneous calculations or assumptions. Furthermore, New Zealand
27
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
has misunderstood the concept of a science-based risk assessment required by Article 5.1. It
argues that instead of conducting a proper scientific risk assessment appropriate to its
circumstances, Australia should have based its measures on the outcome of the Japan – Apples
dispute. The findings of the Japan – Apples dispute are not a risk assessment. Australia does
not accept that the panel in that dispute envisaged that its legal conclusions should be substituted
for a proper risk assessment applying to an entirely different set of circumstances between two
countries with entirely different risk profiles. This is far too high a responsibility to put on
panels and it does not reflect the delicate balance of rights and obligations in the SPS Agreement.
5.
New Zealand relies on the superficially attractive notion of scientific “certainty” around
the transfer and spread of the pests and diseases at issue. This conveniently ignores the range of
credible scientific views on these issues. The IRA Team, in exercising its scientific judgment,
was entitled to rely on the full spectrum of scientific evidence, provided this was from qualified
and respected sources. Neither New Zealand nor the Panel is entitled to substitute its preferred
view of the scientific evidence for that of the IRA Team. In the real world, Members regularly
take measures to mitigate the potentially significant consequences of low probability events.
This is good risk management practice and does not mean that Australia has over-estimated or
exaggerated the risk.
6.
Turning to the individual measures, Australia is confident that the Panel will be able to
verify the rational and objective relationship between the scientific evidence and Australia’s
measures on the basis of the comprehensive assessment of the available evidence in the Final
IRA Report, much of which has been misunderstood by New Zealand.
7.
In respect of fire blight, the Final IRA Report outlines in precise detail the analysis of risk
to arrive at the conclusion that there is an identifiable risk that the causal agent of fire blight,
Erwinia amylovora, could find a pathway into Australia on mature apples and result in serious
consequences. New Zealand relies on irrelevant trade figures from other parts of the world,
erroneous interpretations of the methodology used by the IRA Team and untested assertions
about the likely volume of trade. New Zealand has also wrongly assumed that the consequences
of fire blight infestation in Australia would be the same as they are in New Zealand. Australia
has systematically rebutted these tenuous arguments, thereby demonstrating that New Zealand
has failed to discharge its burden of proof.
28
Australia – Apples (DS367)
8.
Australia’s First Written Submission of Australia
18 July 2008
In respect of European canker, the Final IRA Report outlines in similarly precise detail
the IRA Team’s analysis to arrive at the conclusion that there is an identifiable risk that mature
fruit could provide a pathway for the entry, establishment and spread of the disease, leading to
serious consequences. New Zealand seeks to overturn the IRA Team’s meticulous approach by,
for example, relying on a simplistic climatic analysis which dismisses the fact that a number of
Australia’s apple production areas are in the climatic range New Zealand argues is most
conducive to European canker. New Zealand ignores the biology of the pathogen and its
potential hosts in Australia.
Australia has systematically rebutted each of these tenuous
arguments and demonstrated that New Zealand has failed to discharge its burden of proof.
9.
The IRA Team adhered to its methodical approach when analysing the risk of ALCM’s
entry, establishment and spread, with variations in its methodology to reflect the pest’s mobility.
New Zealand’s arguments display a misunderstanding of the IRA Team’s methodology and the
evidence it relied upon. New Zealand fails to appreciate that ALCM’s mobility required the IRA
Team to consider a much more complex pathway. Australia’s systematic rebuttal of New
Zealand’s arguments demonstrates that New Zealand has failed to discharge its burden of proof.
10.
Australia rejects New Zealand’s assertion that the IRA Team failed to evaluate other
measures that might be applied. It is clear from the Final IRA Report that each of the principal
risk reduction measures and alternatives were evaluated for each of the pests at issue.
11.
Accordingly, Australia’s measures are consistent with Article 5.1 of the SPS Agreement
and, it follows, they are consistent with Article 2.2.
12.
The IRA Team appropriately took into account all of the factors listed in Article 5.2 of
the SPS Agreement. New Zealand’s attempt to convert this to an obligation to give “genuine
consideration” to the factors is not grounded in the text of the provision. Accordingly, Australia
has acted consistently with its obligations under Article 5.2 of the SPS Agreement.
13.
New Zealand has failed to establish that Australia applies different levels of protection in
different situations under Article 5.5. Its simplistic comparison of Australia’s measures for New
Zealand apples and Japanese nashi pears ignores the fact that the risks presented by these two
products are markedly different. Australia applied the same ALOP to each product. New
Zealand has not shown that Australia’s measures are inconsistent with Article 5.5 of the SPS
29
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Agreement. Nor has it provided any substantive arguments to support its claims under Article
2.3.
14.
Australia rejects New Zealand’s claim that its measures are more trade restrictive than
required to achieve its ALOP, under Article 5.6.
Australia is not obliged to implement
alternative measures that do not meet its ALOP, which are not reasonably available or which are
not significantly less restrictive to trade. New Zealand has failed to show that any alternative
measures would achieve Australia’s ALOP. It has not discharged its burden of proof under
Article 5.6.
15.
New Zealand’s claims under Article 8 and Annex C(1)(a) depend on the IRA process
being a measure at issue in this dispute. The Panel has already ruled that the dispute is confined
to the 17 measures listed in New Zealand’s panel request, which do not include the IRA process.
New Zealand’s assertion that Australia is in breach of Article 8 and Annex C(1)(a) is therefore
not within the scope of this dispute.
16.
As New Zealand has failed to meet its burden of proof in respect of any of its claims,
Australia asks the Panel to find that it has not established a prima facie case that any of
Australia’s measures are inconsistent with the SPS Agreement.
Alternatively, if the Panel
considers New Zealand has established a prima facie case in respect of one or more measures,
then Australia requests the Panel find that it has rebutted that case on the basis of its evidence
and legal argument.
30
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
II.
INTRODUCTION
17.
Australia has exercised its right to protect its favourable plant life and health from risks
arising from the introduction of certain debilitating pests and diseases that are endemic to New
Zealand, but not present in Australia. New Zealand can export its apples to Australia, provided it
observes certain risk management measures.
New Zealand has challenged these trade
liberalising, science-based measures by seeking to present an alternative picture of the science.
However, it completely fails to address the legal framework in which the dispute is to be
resolved and as a result fails to demonstrate any breach by Australia of its SPS Agreement
obligations.
(a)
18.
New Zealand has not discharged its burden of proof
New Zealand needs to demonstrate through sufficient evidence and legal argument that
each of the challenged measures fails to meet each of the SPS Agreement provisions cited in the
panel request. It cannot do this by merely presenting an alternative scientific case. Australia
will demonstrate in this submission that New Zealand has not discharged its burden of proof to
establish that Australia’s measures are inconsistent with the SPS Agreement.
This is an
indispensable hurdle that must be met by New Zealand in relation to each of the claims made and
it cannot submit new evidence later in the proceedings to cure any defects.
(b)
19.
The SPS Agreement is a delicate balance of rights and obligations
The Appellate Body has clearly acknowledged “the delicate and carefully negotiated
balance in the SPS Agreement between the shared, but sometimes competing, interests of
promoting international trade and of protecting the life and health of [humans, animals or
plants].”1 Australia fully endorses this statement. In fact, New Zealand has also previously
expressed “a strong interest in ensuring that the delicate balance of rights and obligations set out
in the WTO Agreements, especially the SPS Agreement, is maintained.”2
However, New
Zealand ignores this principle in its first written submission. Instead it challenges the scientific
method and evidence used by the IRA Team apparently oblivious to the need to maintain the
Appellate Body Report, EC – Hormones, para. 177.
Third party written submission of New Zealand in Panel Report, EC – Biotech Products, para. 5.55; and
third party oral statement of New Zealand in Panel Report, EC – Biotech Products, para. 5.73.
1
2
31
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
careful balance it has previously recognised. Australia requests the Panel to have close regard to
this careful balance as it considers this dispute.
(c)
20.
Australia’s measures are based on a valid risk assessment
It is a fundamental tenet of the SPS Agreement that WTO Members retain the sovereign
right to determine their own ALOP and, where necessary, to impose risk management measures
to achieve that ALOP. Australia’s ALOP reflects community expectations that quarantine risks
will be managed to achieve a very low level of risk, but not zero. This ALOP has been carefully
calibrated to enable Australia to maintain its freedom from invasive and at times devastating
pests and diseases that have proliferated elsewhere.
21.
In order to ensure its ALOP was met, Australia conducted a risk assessment 3 for New
Zealand apples in accordance with its obligations under the SPS Agreement. The Final IRA
Report expresses the conclusions of qualified and respected scientists and technical experts in the
exercise of their expert judgment. The IRA Team conducted the risk assessment according to
internationally recognised scientific method that is elaborated at every step in its reasoning in the
600-plus page report.
It is a comprehensive and rigorous report which New Zealand
misunderstands.
22.
Following a detailed analysis of the available scientific evidence, the IRA Team
reasonably concluded that a number of risk mitigation measures were required to ensure that
certain serious and debilitating pests endemic in New Zealand would not be transmitted to
Australia. Australia demonstrates in this submission that the measures required by the Final IRA
Report to minimise the risks of entry, establishment and spread of fire blight, European canker
and apple leafcurling midge (ALCM) are consistent with its SPS Agreement obligations.
(d)
Australia’s risk assessment is based on objective and credible evaluation of
the evidence
23.
The fact that New Zealand can present an alternative view of the scientific evidence does
not establish a breach of the SPS Agreement. In making quarantine regulatory decisions to
achieve its ALOP, Australia is entitled to rely on scientific opinion from qualified and respected
3
Exhibit AUS-2: Biosecurity Australia (2006), Final Import Risk Analysis for Apples from New Zealand,
Part B, Canberra, November 2006.
32
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
sources, including those which display a degree of scientific prudence. The Appellate Body has
recognised this, stating that “responsible and representative governments may act in good faith
on the basis of what, at a given time, may be a divergent opinion coming from qualified and
respected sources”.4 Australia submits that this is especially so when, as in this matter, the
consequences of identified risks may be serious and irreversible.
24.
If the Panel determines that the Final IRA Report is based on one of the range of credible
scientific accounts, then Australia submits that the Panel has no mandate to overturn the
judgments of the IRA Team reflected in the Final IRA Report. The SPS Agreement does not
enable the Panel to put itself in the shoes of the IRA Team and decide which of the various
credible scientific accounts represents the “correct” view of the science. There will be a range of
credible, but competing, scientific views on many issues. Australia is entitled to rely on the
credible scientific account that is most appropriate to its circumstances.
(e)
25.
New Zealand erroneously relies on the findings of the Japan-Apples dispute
The constant reliance by New Zealand on alleged “scientific” findings in the Japan –
Apples dispute represents a major error in terms of how a previous panel decision should be
treated. It is untenable for New Zealand to suggest that Australia should have essentially
abandoned its own science-based risk assessment process and instead based its risk management
measures on the outcomes of the Japan – Apples dispute.5 Australia submits that the Panel
should reject New Zealand’s argument in this regard.
26.
Furthermore, Australia will demonstrate critical differences between the Japan – Apples
dispute and the current dispute. The Japan – Apples dispute was solely concerned with fire
blight, whereas the present dispute also includes European canker and ALCM. Even in relation
to fire blight, there are significant differences including ALOP, climatic conditions, native flora,
potential host plants, the pest and disease status of the importing and exporting Member and the
volume and mode of trade. It is therefore essential that the Panel fulfil its mandate to make an
“objective assessment” of the matter pursuant to Article 11 of the DSU, rather than adopting the
findings of the Japan – Apples dispute as New Zealand suggests.
Appellate Body Report, EC – Hormones, para. 194.
For example: New Zealand, First Written Submission: Australia – Measures Affecting the Importation of
Apples from New Zealand, WT/DS367, 30 June 2008 (hereinafter: “New Zealand’s first written submission”), para.
2.4.
4
5
33
Australia – Apples (DS367)
(f)
Australia’s First Written Submission of Australia
18 July 2008
New Zealand’s allegations of politicisation should be disregarded by the
Panel
27.
Australia notes that New Zealand makes a number of unsubstantiated allegations that the
IRA process was “intertwined” with a political process and asserts that the Final IRA Report was
therefore tainted.6 Australia completely rejects these allegations and notes that New Zealand has
not advanced any credible evidence to support its claims. Instead, New Zealand has presented a
deliberately misleading account based on innuendo, inference, hearsay and misquotes. Australia
does not intend to address each one of New Zealand’s allegations in this submission but
highlights below three examples which demonstrate the baseless nature of New Zealand’s
claims.
28.
New Zealand refers throughout its submission to the activities of various bodies,
including a Senate Committee, an industry group and unions to infer that the IRA process was
“politicised”.7 Australia is surprised that New Zealand, as a fellow parliamentary democracy
with strong pluralist values, considers that robust scrutiny of biosecurity issues by a range of
legitimate bodies amounts to “politicisation” of a separate risk analysis processes undertaken by
the appropriate domestic regulatory agency. It is common in both Australia and New Zealand,
for biosecurity issues to be subject to intense political8 and public9 debate, parliamentary
committee inquiries10 and, at times, domestic court proceedings.11 Australia submits that such
activities are not evidence of “politicisation”, but rather the normal functioning of a healthy
democracy.
For example, New Zealand’s first written submission, paras. 2.8, 2.9, 4.554, 4.559.
For example, New Zealand’s first written submission, para. 2.9; also, paras. 3.18, 4.463-4.471.
8
Exhibit AUS-4: For example, New Zealand’s Minister for Biosecurity said in a press release on New
Zealand’s Biosecurity and Hazardous Substances New Organisms Legislation Amendment Bill that “On some
occasions, however, the process for developing an import health standard becomes affected by a protracted dispute
over some aspects of MAF’s risk management decisions.”
9
Exhibit AUS-5: For example, “Sour Taste of Apple Imports, Apple exporter Enza has upset some of its
Hawke’s Bay growers by shipping in competing stocks of apples from its North American orchards.” The Dominion
Post, 31 January 2008; and “Honey Imports Must Stop For Good”, Press Release, Federated Farmers (New
Zealand), 5 December 2007.
10
For example, New Zealand’s Biosecurity and Hazardous Substances and New Organisms Legislation
Amendment Bill was referred by the New Zealand Parliament to its Select Committee on Primary Production on 19
February 2008 and that Committee issued its report and recommendations on 17 March 2008, which included
amendments to the legislation subsequently implemented by the New Zealand Government.
11
For example, New Zealand’s bee keepers have obtained a court injunction which bans the import of
Australian honey until the import health standard for Australian honey is reviewed by an independent panel.
6
7
34
Australia – Apples (DS367)
29.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand also alleges that the then Prime Minister and Deputy Prime Minister
“pledged” that New Zealand apples would not enter Australia12, and purports to support this
claim by quoting a second hand reference by a State politician in a debate in the New South
Wales State Parliament in March 2001.13 Australia submits that it is the contemporaneous
statements by the Federal Minister for Agriculture in the Federal Parliament of Australia that
accurately reflect the Australian Government’s principled approach to the issue. The following
statement is illustrative:
My Department is cooperating fully with the [Senate] Committee’s inquiry.
However, the import risk analysis on apples from New Zealand is being
carried out in accordance with a science-based administrative process that is
politically independent and was developed in consultation with stakeholders.
The process is consistent with both government policy and Australia’s
international obligations.14
30.
New Zealand also claims the inclusion on the IRA Team of an individual from the apples
industry demonstrates a conflict of interest that tainted the IRA process. Australia rejects this
allegation.
Information on industry production systems, pest management programs and
packing, handling and distribution networks is directly relevant to many of the factors identified
in ISPM No. 1115 to be considered when conducting a risk assessment.
The individual
concerned brought this relevant expertise to the IRA Team. Moreover, the fact that someone has
commercial interests does not mean they have an automatic conflict of interest and should be
barred from the process.
New Zealand’s own risk assessment processes do not bar such
individuals16 and acknowledge that a range of knowledge, experience and skill, in addition to
scientific expertise, may be appropriate on a risk assessment panel.17
Furthermore, the
New Zealand’s first written submission, paras. 3.14 and 4.555.
Exhibit NZ-86: Parliament of New South Wales, Legislative Assembly Hansard, New Zealand apple
and pear importation, Urgent motion, 6 March 2001, 3.50pm.
14
Parliament of Australia, Hansard, House of Representatives, 26 March 2001.
15
Exhibit AUS-6: International Plant Protection Convention, International Standard for Phytosanitary
Measures No. 11: Pest risk analysis for quarantine pests including analysis of environmental risks and living
modified organisms, 2004.
16
Exhibit AUS-7: Biosecurity New Zealand, Risk Analysis Procedures, Version 1, Wellington, 12 April
2006, paras. 3.3.3 and 3.2.4.
17
Exhibit AUS-8: Department of Internal Affairs New Zealand (2008), “Notice Number: 4582:
Biosecurity (Process for Establishing Independent Review Panel) Notice 2008”, New Zealand Gazette - Te Kahiti o
Aotearoa, 26 June 2008, p. 2765.
12
13
35
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
individual concerned signed a declaration detailing his commercial interests and pledging that he
would carry out his duties impartially and independently.18
31.
New Zealand has also erroneously claimed that public comments by the Executive
Manager of Biosecurity Australia at the time of the appointment “acknowledging the clear
conflict of interest created”.19 In fact, according to the media report that New Zealand relies on
to support its claims, the Executive Manager merely acknowledged that it was “a potential
issue”.20
32.
In view of these serious shortcomings, Australia requests the Panel to disregard these
allegations in their entirety and confine itself to considering the scientific and legal issues that
arise in this dispute as reflected in the rights and obligations elaborated in the SPS Agreement.
Australia requests the Panel have faithful regard to the carefully negotiated text of the SPS
Agreement which recognises the fundamental right of all WTO Members to conduct their own
risk assessment against their own ALOP and to base their SPS measures on scientific evidence.
This is what Australia has rightly done with respect to New Zealand apples.
III.
PROCEDURAL BACKGROUND
33.
On 31 August 2007, New Zealand formally initiated WTO dispute settlement action by
requesting consultations with Australia.21 Consultations took place in Geneva on 4 October
2007, with the United States and European Communities participating as third parties.
Consultations failed to resolve the dispute.
34.
On 6 December 2007, New Zealand requested the establishment of a WTO dispute
settlement panel.22 This request was considered at the WTO Dispute Settlement Body (DSB)
meeting on 17 December 2007. Australia did not consent to New Zealand’s first request for the
18
Exhibit AUS-9: Consultancy Agreement for Participation on the Risk Analysis Panel for the Importation
of Apples From New Zealand to Australia (Commonwealth of Australia and Armour’s Apples Pty Ltd), 20 March
2002, Clause 13, “Conflict of Interest”.
19
New Zealand’s first written submission, para 4.470.
20
Exhibit NZ-90: “Apple grower added to risk panel”, ABC National Rural News, 10 January 2002.
21
WT/DS367/1.
22
WT/DS367/5.
36
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
establishment of a panel, but a panel was established at the DSB meeting on 21 January 2008
following New Zealand’s second request.
35.
The Director-General of the WTO composed the dispute settlement panel (the Panel) on
12 March 2008. The United States, the European Communities, Japan, Chinese Taipei, Pakistan
and Chile joined the dispute as third parties.
36.
On 13 March 2008, Australia submitted to the Panel a request for a preliminary ruling on
the adequacy of New Zealand’s panel request. New Zealand lodged a rebuttal submission on 7
April 2008. Australia and New Zealand lodged further submissions on 14 and 16 April 2008
respectively. The European Communities and Chile submitted third party submissions on 30
April 2008 and 2 May 2008 respectively, and both Australia and New Zealand lodged further
submissions in response to the third party submissions on 9 May 2008. The Panel issued its
ruling on 6 June 2008, limiting the measures at issue in this dispute.23 Australia is proceeding on
the basis of the Panel’s preliminary ruling, but without prejudice to its rights to pursue its
procedural claims at a later stage.
23
WT/DS367/7.
37
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
IV.
FACTUAL BACKGROUND
37.
Parts A and B of this Factual Background outline information on Australia’s quarantine
and biosecurity situation, the size and location of the apple and pear industry and the operation of
Australia’s quarantine system. Parts C, D and E provide factual background specific to issues
raised in this dispute, particularly regarding the Final IRA Report.
A.
OVERVIEW OF AUSTRALIA’S QUARANTINE AND BIOSECURITY SITUATION
1.
Australia is free of many of the world’s plant pests and works hard to preserve this
status
38.
Australia’s island status, geographic isolation, relatively short history (220 years) of
agricultural production and established science-based quarantine system24 have helped it to
remain free from many of the world’s serious agricultural plant pests and diseases. 25 This means
that Australia is free of many serious horticultural pests and diseases including fire blight,
European canker and apple leafcurling midge.
39.
Maintaining this favourable plant health status is critical for the success of Australia’s
agricultural sector. The lower incidence of pests and diseases in Australia allows for increased
productivity, enables Australia to promote its produce as “clean and green”, and is crucial to
developing and retaining access to overseas markets. Australia therefore invests significant
resources in a “quarantine continuum” of pre-border, border and post-border quarantine and
biosecurity activities.
These activities not only help to maintain the health of Australia’s
agricultural industries, but also the unique natural environment and biodiversity.
40.
Maintaining Australia’s favourable plant health status is increasingly challenging with
the expanding range and volume of internationally traded plant commodities. The Food and
Agricultural Organization has noted that “[g]rowth in the trade of fresh fruit and vegetables is
24
Australia has had a federal quarantine service since 1908.
According to the CAB International Crop Protection Compendium (Global Module, 4th Edition,
Wallingford UK, 2002) around 80% of the world’s plant pests and diseases are not present in Australia (the
Compendium records 5732 pests and diseases present in the Western Hemisphere, Europe, Asia, Africa and
Oceania, of which 4581 are not recorded in Australia).
25
38
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
responsible for many of the quarantine pest problems today”.26 Although Australia is a major
agricultural exporter, food and agricultural product imports amounted to A$8.2 billion in 200607.27 Australia’s quarantine system therefore needs to be dynamic and rigorous to respond to
this challenge. For example, quarantine controls at the Australian border have recently been
strengthened and more scientific and technical staff engaged to undertake import risk
assessments.
2.
Australia has particular vulnerabilities to exotic pests
41.
The Australian continent has six distinct climatic zones, ranging from tropical,
subtropical, desert, warm and cool temperate, and alpine zones, making it suitable for the
establishment and spread of all exotic pests and diseases.
42.
Australia’s broad climatic conditions support the production of a diverse range of crops
and plants over a vast land area, providing a wide range of potential hosts for exotic pests and
diseases. Australian horticultural production, for example, occurs across the tropical, subtropical
and temperate climatic zones and includes stone fruit, orange, grape, banana, pineapple,
mandarin, avocado, mango, papaya, tomato, potato, pear, nuts, olives, and apples.28
43.
Nearly all of Australia’s agriculture is based on introduced plant species that have
flourished in the absence of pests and diseases found in their source countries. As a result, in
many instances the species used in Australian agricultural production lack resistance to exotic
pests and diseases.
3.
Australia’s biodiversity and agriculture are significant assets
(a)
44.
Australia’s biodiversity is of intrinsic value
Australia is one of the most biologically diverse countries in the world29 with an
estimated one million species of plants, animals and micro-organisms (7% of the world’s total).30
26
Food and Agricultural Organization of the United Nations (2001). The State of Food and Agriculture
2001. FAO Agriculture Series 33, Part III: Economic Impacts of Transboundary Plant Pests and Animal Diseases,
Section 1, Overview – A History of Transboundary Pest and Disease Control, Plant Pests.
27
ABARE 2007, Australian Commodity Statistics 2007, Canberra
28
Department of Agriculture, Fisheries and Forestry (2005). Australian Horticulture Factsheet, December
2005.
29 Williams, J., Read, C., Norton, A., Dovers, S., Burgman, M., Proctor, W. and Anderson, H. (2001).
Biodiversity, Australia State of the Environment Report 2001 (Theme Report). Part 2: The meaning, significance
39
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
About 80% of Australia’s plant and animal species are not naturally found on any other
continent.31 Australia’s unique biodiversity is largely the result of the country’s geographic
isolation, its vast size32, and its climate variability.33
45.
In addition to its benefit to human-kind, Australia’s unique biodiversity also has
considerable economic value. The distinctive flora and fauna of Australia are of world renown.
In the year ending June 2007, 68% of all international visitors to Australia participated in naturebased tourism activities.34 There is also established trade in native flowers and plants35 and an
increasing range of gourmet bush foods.36
46.
The potential susceptibility of Australian native flora to exotic pests and diseases is
largely untested although some serious exotic pests and diseases have been shown
experimentally to be suited to native plants as hosts. Examples include the Asian gypsy moth 37
and Eucalyptus rust38 (also known as Guava rust). These pests and diseases have the potential to
devastate Australia’s wildlife flora and dependent fauna, with flow-on effects to the social value
of public amenities.
(b)
Australia’s agricultural sector is economically significant
and implications of biodiversity – Megadiverse countries (pg 13). CSIRO Publishing on behalf of the Department of
the Environment and Heritage, Canberra.
30
Australian Museum Online: Australia’s biodiversity. Website last accessed April 2008:
http://www.amonline.net.au/biodiversity/what/australia.htm
31 Beeton, R., Buckley, K., Jones, G., Morgan, D., Reichelt, R. and Trewin, D. (2006). Australia State of
the Environment Report 2006. Chapter 5: Biodiversity. Independent report to the Australian Government Minister
for the Environment and Heritage by the 2006 Australian State of the Environment Committee.
32
7,617,930 square kilometres: Geoscience Australia webpage: Australia’s size compared.
http://www.ga.gov.au/education/facts/dimensions/compare.htm
33
Beeton, R., Buckley, K., Jones, G., Morgan, D., Reichelt, R. and Trewin, D. (2006). Australia State of
the Environment Report 2006. Chapter 5: Biodiversity. Independent report to the Australian Government Minister
for the Environment and Heritage by the 2006 Australian State of the Environment Committee.
34
Tourism Australia (2007). Nature tourism fact sheet 2007. Tourism Research Australia.
35
For example, up to 95% of Australian flower exports are Australian native flowers, with production of
Australian native species valued at $50 million per year: NSW Department of Primary Industries webpage. Growing
Australian native flowers commercially.
36
For example, the macadamia tree is an Australian native plant that has been successfully commercialised
through development of the market for the nuts, with production valued at over $100 million per year: Macadamia
Society (2007) Australian Macadamias, Statistics.
37
Matsuki, M., Kay, M., Serin, J., Floyd, R. and Scott, J. (2000). Potential risks of accidental introduction
of Asian gypsy moth (Lymantria dispar) to Australia and New Zealand: effects of climatic conditions and suitability
of native plants. Contracted Report no. 57. CSIRO, Entomology.
38
Tommerup, I., Alfenas, A. and Old, K. (2003). Guava rust in Brazil - a threat to Eucalyptus and other
Myrtaceae. New Zealand Journal of Forestry Science 33: 420-428.
40
Australia – Apples (DS367)
47.
Australia’s First Written Submission of Australia
18 July 2008
Agriculture’s contribution to the Australian economy is substantial. In the 2006-07
financial year, agriculture directly contributed A$39.5 billion to the Australian economy (3.9%
of Gross Domestic Product), with crops valued at A$20.2 billion and livestock products valued
at A$19.3 billion.39 It also directly employed around 3.5% of the Australian workforce40, rising
to around 17% if associated industries are included.41
48.
Agriculture in Australia has a strong export focus with around 67% of total production
being exported each year.42 In 2006-07 total farm exports were valued at close to A$28 billion43
and agricultural products, including processed products, accounted for 16.1% of Australian
merchandise exports.44 Horticulture is the fastest growing agricultural industry in Australia. It
has a farm gate value of A$7 billion and total horticultural exports in 2006-07 were valued at
A$763 million.45
49.
Exotic pests and diseases pose a real threat to the viability and sustainability of
Australia’s plant industries and the regional economies and communities that they sustain. The
negative impacts associated with plant pests and diseases, such as produce damage and reduced
yield, in turn result in increased production inputs and higher management costs.46
(c)
50.
Australia’s apple and pear industry is important
The apple and pear industry is Australia’s second largest fruit industry by value.47 Total
production of apples and pears in 2006-07 was approximately 405,000 tonnes with the apple
industry accounting for two thirds of the total.48
39
Australian Bureau of Agricultural and Resource Economics (2008). Australian Commodities, Volume 15
No. 1, March Quarter 08.1, Table 21: Gross value of farm and fisheries production.
40
Australian Bureau of Agricultural and Resource Economics (2008). Australian Commodities, Volume 15
No. 1, March Quarter 08.1, Table 10: Employment.
41
Econtech Pty Ltd (2005). Australia's Farm-Dependent Economy: Analysis of the Role of Agriculture in
the Australian Economy. Overview (pg x). Australian Farm Institute, Surry Hills, Australia.
42
Department of Foreign Affairs and Trade website. Agriculture and the WTO, Australia – Agricultural
and Food Exporter. http://www.dfat.gov.au/trade/negotiations/trade_in_agriculture.html
43
Australian Bureau of Agricultural and Resource Economics (2008). Australian Commodities, Volume 15
No. 1, March Quarter 08.1, Table 25: Value of commodity exports.
44
Department of Foreign Affairs and Trade website. Agriculture and the WTO, Australia – Agricultural
and Food Exporter. http://www.dfat.gov.au/trade/negotiations/trade_in_agriculture.html
45
Horticulture Australia Ltd (2008). Horticulture Industries.
46
Hyam, L. (2008) Plant Biosecurity – The Way Ahead. Farm Policy Journal, Vol.5 No. 1, pp 47-57,
February Quarter 2008.
47
Australian Bureau of Statistics (ABS), “2006 – 07 Value of Principal Agricultural Commodities
Produced Australia Preliminary”, 7501.0, 12 February 2008, Canberra, p5.
41
Australia – Apples (DS367)
51.
Australia’s First Written Submission of Australia
18 July 2008
The apple industry consists of approximately 1,200 apple growers with 9.9 million apple
trees49 producing, on average, 306,000 tonnes per year over the last ten years. 50 While, apple
production dropped to 270,000 tonnes in 2006-0751 due to the effects of drought, the gross value
of apple production in 2006-07 was nonetheless A$475 million.52 Approximately 97% of apple
production was sold on the domestic market in 2006-07 and exports accounted for 3% of
production.53 The major export markets for Australian apples in 2006-07 were the United
Kingdom, Indonesia, India, Chinese Taipei, Malaysia and Sri Lanka.54
52.
Apples are produced in all Australian states, with Victoria and New South Wales the
largest producers, respectively accounting for, in round figures, 43% and 14% of total
production. The share of production in other states is as follows: Western Australia (12%),
Tasmania (11%), Queensland (11%), and South Australia (10%).55 A high proportion of apple
growers also produce pears, stone fruit or cherries. The map at Figure 3 of Annex 2 to this
submission shows the major pome fruit regions of Australia.
53.
Australia has a large domestic pear production industry, with approximately two million
pear trees.56 Over the last ten years pear production has averaged 147,000 tonnes per year.57
The gross value of pear production in 2005-06 was A$86 million.58 The major export markets
for Australian pears in 2006-07 were New Zealand, Canada, Indonesia, Malaysia, India and
Singapore59 with exports accounting for approximately 3% of total production.60
48
ABS, “2006-2007 Agricultural Survey, Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra,
49
ABS, “2006-2007 Agricultural Survey, Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra,
p4-5.
p3..
ABS, “1999-2000 Agriculture”, 7113.0, 4 October 2001 p83; ABS, “2002-2003 Agricultural Survey,
Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra, p4-5; ABS, “2006-2007 Agricultural Survey,
Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra, p4.
51
ABS “2006-2007 Agricultural Survey, Apples and Pears”, 7121.0.55.002, 18 December 2007, p4.
52
ABS, “2006-2007 Value of Principal Agricultural Commodities Produced Australia Preliminary”,
7501.0, 12 February 2008, p5.
53
ABS, “2006-07 International Trade Australia”, 5465.0, Canberra.
54
ABS, “2006-07 International Trade Australia”, 5465.0, Canberra.
55
ABS, “2006-2007 Agricultural Commodities”, 7121.0, 28, May 2008, Canberra, p18.
56
ABS, “2006-2007 Agricultural Survey, Apples and Pears”, 7121.0.55.002, 18 December 2007; p3.
57
ABS, “1999-2000 Agriculture”, 7113.0, 4 October 2001 p83; ABS, “2002-2003 Agricultural Survey,
Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra, p4-5; ABS, “2006-2007 Agricultural Survey,
Apples and Pears”, 7121.0.55.002, 18 December 2007, Canberra, p4.
58
ABS, “2005-06 Value of Agricultural Commodities Produced”, 7503.0, Canberra, p7.
59
ABS, “2006-07 International Trade Australia”, 5465.0, Canberra.
50
42
Australia – Apples (DS367)
54.
Australia’s First Written Submission of Australia
18 July 2008
Pear production is heavily concentrated in Victoria and accounts for 88% of total
Australian production.61 Most of this production is in the Goulburn Valley.62 Production in
other States is as follows: Western Australia (6%), South Australia (4%), Tasmania (0.5%),
Queensland (0.4%) and New South Wales (0.2%).63
B.
AUSTRALIA’S QUARANTINE SYSTEM
1.
Australia has a comprehensive and effective quarantine system
55.
In 1908, the Australian government introduced the Quarantine Act 1908 (Cth), Act No. 3
of 1908 to establish a federal quarantine service.64 Since that time, Australia’s quarantine system
has successfully responded to developments in scientific understanding, technology and the
expansion of trade. This has been facilitated by a number of major reviews which have driven
continuous improvement and consistently highlighted the importance of Australia’s rigorous
approach to quarantine in a dynamic trading environment.
2.
Australia dedicates significant resources to its quarantine continuum
56.
Australia’s quarantine and biosecurity system is a continuum of activities in all three
stages of quarantine control – pre-border, border and post-border – involving all levels of
government, industry and the community.
i.
57.
Pre-border
At the pre-border level, Australia conducts targeted surveys, monitoring and awareness
programs along our northern coastline and in neighbouring countries; funds offshore research to
assist countries to our near north address risks with transboundary movement of pests and
ABS, “2006-07 International Trade Australia”, 5465.0, Canberra.
ABS, “2006-2007 Agricultural Commodities”, 7121.0, 28, May 2008, Canberra, p18.
62
Oliver, G., Viljoen, J., McGillivray, M. and Orton, T. (1997), The Potential impact of fire blight on the
Australian apple and pear industry: a socio-economic study. Corporate Strategy Consulting. 60p.
63
ABS, “2006-2007 Agricultural Commodities”, 7121.0, 28, May 2008, Canberra, p18.
64
Quarantine Act 1908 (Cth), Act No. 3 of 1908 as amended, remains the main legislative instrument
underpinning Australian quarantine.
60
61
43
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
diseases; develops offshore quarantine and biosecurity arrangements; and gathers intelligence on
the pest and disease status of trading partners through bilateral and multilateral cooperation.
ii.
58.
At the border
The level of intervention by Australian quarantine officers at the border is among the
highest of any country in the world.65
Over 80% of passenger baggage is screened at
international airports and 100% at international ports. In addition, 100% of international mail is
screened for material of quarantine concern, 100% of international vessels are inspected and the
exteriors of all sea cargo containers and 95% of air cargo containers are inspected. As a result,
each month quarantine staff seize on average around 7.7 tonnes of plant material of quarantine
concern (fresh fruit, vegetables, plants and seeds) at airports and 500kg at mail centres.66
iii.
59.
Post-border
A major focus of Australia’s post-border biosecurity system is preparedness, early
detection and a nationally-coordinated response to exotic pest and disease incursions.
Significant investment is made in the eradication of exotic pests and diseases. For example, the
eradication of a citrus canker outbreak in Queensland in 2004 cost in excess of A$18 million
over four years.67 The Government also funded a A$12 million recovery package to assist
affected citrus growers.68 It is not always possible to eradicate exotic pests and diseases. For
example, Western flower thrip has established and spread in most Australian states since 1993
and costs to industry for control of this pest are estimated at $100 million annually. 69
65
Each year, more than 11 million passengers and crew at airports, 146 million mail items and 1.6 million
non-commercial air-cargo consignments, 13,000 vessels and 95,000 sea passengers, and 1.6 million seas containers
and 380,000 air cargo containers arrive in Australia.
66
These figures are subject to seasonal variation. For the Airports program, there is a spike in incoming
passengers at the end of January and start of February as people return home from overseas trips following school
holidays. For the Mail program, there is a spike in December associated with increased incoming mail during the
Christmas period.
67
Queensland Department of Primary Industries and Fisheries webpage. National Citrus Canker
Eradication Program, Program Summary.
68
The Senate Rural and Regional Affairs and Transport Legislation Committee (2006). The Administration
by the Department of Agriculture, Fisheries and Forestry of the Citrus Canker Outbreak. Chapter 4: Impact of citrus
canker on the Australian industry.
69
Ullio, L. (2002). Australia’s National Strategy for the Management of Western Flower Thrips (WFT),
Frankliniella occidentalis (Pergande). Acta Horticulturae; Lonsdale, M., Floyd, R., Vickers, R., De Barro, P.,
Chakraborty, S., Groves, R. and Clarke, G. (2001). Implications of Incursion Ecology for Managing Incursions for
the Plant Sector, Appendix 1 (pg 22), CSIRO, Canberra, ACT.
44
Australia – Apples (DS367)
3.
Australia’s First Written Submission of Australia
18 July 2008
Australia’s quarantine system is based on a strong legal, administrative and
operational framework
60.
The Australian quarantine system is supported by Commonwealth, and State and
Territory quarantine laws.70
61.
At the Federal level, the key quarantine and biosecurity functions are located within the
Department of Agriculture, Fisheries and Forestry (DAFF). The Secretary of DAFF is the
Director of Animal and Plant Quarantine under the Quarantine Act 1908 and is responsible for
determining whether the import of a particular commodity may be permitted, and if so, whether
any conditions are required.
62.
The Australian Quarantine and Inspection Service (AQIS) manages quarantine controls at
the border, develops operational procedures for imports, provides export certification, and makes
import permit decisions.
Biosecurity Australia provides science-based risk analyses and
quarantine policy advice to the Director of Animal and Plant Quarantine and AQIS.
63.
DAFF works with State and Territory governments on national activities to maintain
Australia’s favourable animal and plant health status, including emergency preparedness and
response programs. The State and Territory governments have their own quarantine legislation
to manage risks associated with the interstate movement of plants, animals and their products.
64.
Each year, Australia receives many proposals to commence imports of plants, animals
and their products. An import risk analysis (IRA) is conducted by Biosecurity Australia when
there is no existing quarantine policy or a significant change in existing quarantine policy is to be
considered.
For example, an IRA would be required for new commodities that have not
previously been imported into Australia and commodities that are already imported where the
import request is from a different country or area with a significantly different pest status.
65.
The administrative process that applies to Biosecurity Australia’s conduct of IRAs is set
out in the Import Risk Analysis Handbook. The Import Risk Analysis Handbook 200371 applied
70
Commonwealth quarantine laws are contained in the Quarantine Act 1908 and in its subordinate
legislation found in the Quarantine Proclamation 1998, Quarantine (Cocos Islands) Proclamation 2004 and
Quarantine (Christmas Island) Proclamation 2004, the Quarantine Regulations 2000 and Quarantine Amendment
Regulations 2007 (No. 1).
71
Exhibit AUS-10: Biosecurity Australia (2003) Import Risk Analysis Handbook.
45
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
to the conduct of the New Zealand apples IRA.72 New regulations came into effect in September
200773 (after the New Zealand apples IRA was finalised) to increase the transparency and
efficiency of the system and to provide a greater opportunity for independent scientific review.
The updated process is set out in the Import Risk Analysis Handbook 2007.
C.
THE FINAL IMPORT RISK ANALYSIS FOR APPLES FROM NEW ZEALAND
66.
New Zealand submitted a market access application in January 1999, requesting a review
of available risk management options for apples from New Zealand. AQIS advised stakeholders
in February 1999 that it would conduct an IRA for the importation of apples from New Zealand.
67.
Biosecurity Australia (formerly a part of AQIS) released a draft IRA report on apples
from New Zealand to stakeholders on 11 October 2000. It recommended the importation of
New Zealand apples to Australia subject to 11 phytosanitary measures, including inspection and
disinfestation regimes in orchards, packing houses and stores. The draft IRA report was made
available for public comment and 142 submissions were received, including a submission from
New Zealand.
68.
Biosecurity Australia informed stakeholders on 8 October 2001 that a Risk Analysis
Panel would complete the IRA74 in order to more efficiently utilise the available scientific and
other expertise, and to allow more comprehensive attention to the issues raised by stakeholders.
The Risk Analysis Panel was subsequently renamed the “Import Risk Analysis team”, consistent
with the terminology in the Import Risk Analysis Handbook 2003. Throughout 2002 and 2003
72
The IRA Handbook 2003 applied during the period from August 2003 to 5 September 2007.
The Quarantine Amendment Regulations 2007 amend the Quarantine Regulations 2000 to identify two
types of Import Risk Analysis (IRA), a standard IRA and an expanded IRA, and specify the steps and maximum
timeframes that apply for each type of IRA.
74
The seven Risk Analysis Panel members were confirmed on 10 January 2002 as :
Dr Bill Roberts (Chairman) – Biosecurity Australia’s Principal Scientist;
Mr Bill Hatton – Specialist in fruit production with expertise in growing, packing and shipping;
Mr David Cartwright – Plant pathologist and Manager Plant Health, Department of Primary Industries and
Resources, South Australia;
Dr Kent Williams – Principal Research Scientist, CSIRO Sustainable Ecosystems;
Mr Ian Armour – Owner and manager of an apple production business;
Dr Brian Stynes – Plant pathologist and former General Manager, Plant Biosecurity, Biosecurity Australia;
Mr Mike Kinsella – Passed away in January 2002. No replacement was sought.
73
46
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
the IRA Team met 16 times to review relevant scientific information and separate technical
working groups met to examine arthropod and fungal pests in more detail.
69.
Biosecurity Australia released a revised draft IRA report for New Zealand apples in
February 2004 for stakeholder comment.
The formal comment period was extended until
23 June 2004 to allow stakeholders sufficient time to review scientific content and provide
meaningful feedback. Two hundred submissions were received.
70.
When Biosecurity Australia was made a prescribed agency in late 2004, the Government
undertook that the agency would review and reissue draft IRAs in progress at that time,
including the New Zealand apples revised draft IRA. An Eminent Scientists Group (ESG) was
also established to provide independent scientific scrutiny of IRAs.75
71.
In preparing a further revised draft IRA report, the IRA Team again met a number of
times to consider the substantial number of submissions that had been received on the previously
issued revised draft IRA report and Biosecurity Australia held meetings with stakeholders in
major apple producing areas of Australia and with New Zealand. The further revised draft IRA
report was released in December 2005 for a 120 day comment period that closed on
30 March 2006. Stakeholders provided 40 submissions on the report. Biosecurity Australia met
with New Zealand to clarify issues arising from its previous submission.
72.
A draft final IRA report was provided to the ESG on 1 August 2006. On 4 October 2006
the ESG reported to the Director of Animal and Plant Quarantine that Biosecurity Australia had
properly considered the 40 stakeholder submissions. The Final IRA Report for New Zealand
apples was issued by Biosecurity Australia on 30 November 2006.
73.
The IRA process was comprehensive and rigorous, requiring the examination of an
extensive range of scientific and technical information, a large number of stakeholder
submissions and consultations with interested parties, including New Zealand.
summarising these steps is included at Annex 1.
A timeline
Overall the IRA process involved the
categorisation of 443 pests and diseases to identify the quarantine pests and diseases of concern
to Australia on New Zealand apples and the subsequent detailed examination of 16 pests and
diseases.
75
Plant Biosecurity
Analysis, 16 August 2004.
Policy Memorandum 2004/22: New Arrangements to Strengthen Import Risk
47
Australia – Apples (DS367)
74.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team exercised scientific judgment at every step of the process, taking into
account the numerous stakeholder submissions, including New Zealand’s.
Table 1 below
demonstrates how the measures proposed for one of the pests examined evolved in each iteration
of the IRA in light of this deliberative process:
Table 1: Evolution of IRA Team’s Proposed Measures for Fire Blight
2000 Draft IRA
2004 Draft IRA
Apples to be sourced from
areas free of fire blight
symptoms
Apples to be sourced from
areas free of fire blight
symptoms
Apples to be sourced from
areas free of fire blight
symptoms
- verified by 3 inspections
per season (fruitlet, full
bloom and 2 weeks before
harvest)
- verified by 1 inspection of
fruit immediately before
harvest
- verified by 1 inspection 4-7
weeks after flowering
50 metre buffer zone around
an orchard
Not required
Chlorine disinfestation of
harvesting bins
Not required
Not required
Chlorine disinfestation of
fruit
Chlorine disinfestation of
fruit
Chlorine (or equivalent)
disinfestation of fruit
Not required
Cold storage of fruit for 6
weeks
Not required
48
2006 Final IRA Report
Not required
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
D.
PESTS AT ISSUE IN THIS DISPUTE
75.
New Zealand’s first written submission76 outlines the pests77 at issue in this dispute - fire
blight, European canker and apple leafcurling midge (ALCM). Australia does not intend to
repeat this factual information but has flagged some points of difference, which are elaborated
later in this submission. It is important to note that Australia is free from all three of these
serious pests, which are widespread in New Zealand.
76.
To assist the Panel, Australia has exhibited diagrams showing the different parts of an
apple flower and an apple fruit, as well as the respective life cycles of the three pests at issue.78
1.
Fire blight
77.
Fire blight has been reported in 46 countries and is endemic in New Zealand. The
discovery of fire blight in Australia by a New Zealand scientist in the Royal Botanic Gardens
Melbourne was an isolated and unexplained occurrence. National surveys conducted for the
three years following the detection have confirmed the absence of the disease in Australia.
78.
Australia disagrees with New Zealand’s assertion79 that infection of mature fruit does not
occur and cannot serve as a source of new infection.
79.
Australia notes that rain, insects, wind and pruning tools are the main methods of
spreading inoculum of Erwinia amylovora (the causal agent of fire blight) and that bees are the
primary agents for secondary spread of inoculum from infested flowers to newly opened ones.
80.
New Zealand claims recent incursions of fire blight are attributed to the introduction of
nursery stock from infected regions and not from trade in apple fruit.80 Australia notes that there
is considerable uncertainty as to the cause of fire blight incursions and unexplained occurrences
are not unknown.
New Zealand’s first written submission, paras. 3.46 -3.80.
According to the IPPC definition, “Pest” means any species, strain or biotype of plant, animal or
pathogenic agent injurious to plants and plant products. Australia therefore uses the term “pest” in this context.
78
Exhibit AUS-11: Diagram of parts of apple flower and apple fruit; Exhibit AUS-12: Life cycles of fire
blight, European canker and apple leafcurling midge.
79
New Zealand’s first written submission, para. 3.51.
80
New Zealand’s first written submission, para. 3.53.
76
77
49
Australia – Apples (DS367)
81.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand’s concept of primary hosts for fire blight is flawed. 81 Around 150 suitable
host plants for fire blight are widely distributed throughout Australia, including apple and pear
orchards and common household and garden plants.
82.
New Zealand has not provided any details of the serious consequences of fire blight
disease. Fire blight is the most serious disease of pome fruit trees in the world. It directly
impacts on production by killing branches and reducing the fruiting capacity of future crops.
2.
European canker
83.
European canker is present in large parts of Europe, North America, South America, the
Middle East, and South Africa. In New Zealand, European canker is present in several districts
in which export orchards are located.
84.
Australia disagrees with New Zealand’s assertions on spread,82 and climatic conditions
required for development.83 Australia has provided an alternative climatic analysis in Annex 2
of this submission. Australia does not accept New Zealand’s characterisation84 of the Tasmanian
outbreak. In respect of New Zealand’s claims regarding fruit rot85, Australia notes that fruit rot
has occurred in New Zealand.
New Zealand has not provided any details of the serious
consequences of European canker, which is one of the most economically damaging diseases of
apple production.86
3.
Apple leafcurling midge
85.
Australia disagrees with New Zealand’s assertions as to the requisite conditions for adult
emergence of ALCM,87 the number of generations of ALCM per year,88 the flight range of
ALCM and its assertions on spread.89 As the adult ALCM is a flying insect, it does not require a
vector (or carrier) to be able to spread from its initial location.
New Zealand’s first written submission, para. 3.46.
New Zealand’s first written submission, paras. 364-366.
83
New Zealand’s first written submission, para. 3.66, Annex 3.
84
New Zealand’s first written submission, para. 3.68.
85
New Zealand’s first written submission, para. 3.57.
86
Final IRA Report, Part B, p. 146; Exhibit NZ-7: Grove, 1990a; Exhibit AUS-50: Latorre et al. 2002.
87
New Zealand’s first written submission, para. 3.74.
88
New Zealand’s first written submission, para. 3.75.
89
New Zealand’s first written submission, para. 3.77.
81
82
50
Australia – Apples (DS367)
86.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand has not provided any details of the serious consequences of ALCM. High
populations of ALCM in young trees result in reduced crop yields in apple orchards. 90 Leaf and
shoot damage to young trees and grafts can be very severe, resulting in poor shoot development
and distortion of the shape of the tree, potentially affecting the long term yield potential of trees.
A yield increase of 10% has been achieved in studies in which insecticides were applied to
ALCM infestations.91 ALCM has also been shown to affect photosynthesis in leaves. The
detection of ALCM larvae or pupae on apple fruit can lead to the rejection of that fruit for preclearance export by some countries and other countries require treatment upon arrival.92
E.
THE METHODOLOGY APPLIED BY THE IRA TEAM
1.
The IRA Team comprehensively and rigorously assessed likelihood and
consequences to arrive at risk
87.
Annex A(4) of the SPS Agreement, in part, defines “risk assessment” as:
[t]he evaluation of the likelihood of entry, establishment or spread of a pest or
disease within the territory of an importing Member according to the sanitary
or phytosanitary measures which might be applied, and of the associated
potential biological and economic consequences.
88.
Australia submits that the Final IRA Report falls within this definition. The definition
contains the elements of “likelihood” and “consequences” which are combined to estimate risk.93
This concept of risk founds the IRA Team’s methodology.
90
Tomkins, 1998 (accessed 5/06/2008); CABI, 2002.
Kolbe, 1982.
92
Exhibit NZ-15: Suckling DM, Walker JTS, Shaw PW, Manning L, Lo P, Wallis R, Bell V, Sandanayaka
WRM, Hall DR, Cross JV & El-Sayed AM (2007) “Trapping Dasineura mali (Diptera: Cecidomyiidae) in Apples”,
Journal of Economic Entomology 100(3), 745; Tomkins AR (1998) “Apple leaf-curling midge life cycle”,
HortFACT, (Horticulture and Food Research Institute of New Zealand Ltd); Final IRA Report, Part B, page 186.
93
See also ISPM No. 5 which defines “pest risk (for quarantine pests)” as: “The probability of introduction
and spread of a pest and the magnitude of the associated potential economic consequences.”
91
51
Australia – Apples (DS367)
2.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team comprehensively and rigorously evaluated the likelihood of entry,
establishment and spread
89.
For a pest incursion to happen in Australia as a result of trade in fruit, there has to be a
chain of events from the exporting country to suitable host plants in Australia. Typically, this
requires that the pest is present in the orchard; that it remains on or in the fruit at harvest; that it
survives packing, storage and transport to Australia; that it is not detected at on-arrival
inspection; that it ends up close to and is exposed to suitable host plants; that infestation or
infection occurs; and that the pest population becomes self-perpetuating. These events constitute
a pathway.
i.
90.
The IRA Team rigorously applied a sound quantitative approach
The SPS Agreement does not prescribe a methodology for evaluating the likelihood of
entry, establishment and spread of pests.
methodology.
Accordingly, a Member may choose its own
The IRA Team rigorously applied a sound and transparent quantitative
methodology in evaluating pathways for pests associated with apples from New Zealand.94 The
IRA Team estimated probabilities for individual elements of pathways, which were combined
into an overall probability of entry, establishment and spread (PEES) for each pest. The term
“probability” is used rather than “likelihood”.95
The commercial risk modelling package
@RISK96 was used to facilitate the quantitative evaluation of PEES.
ii.
91.
The IRA Team chose individual apples as the appropriate risk unit
In evaluating PEES, the IRA Team had to determine the risk unit on which to base its
analysis. The IRA Team concluded that individual apple fruit carrying a pest could present a
risk and that it was therefore appropriate to use individual fruit as the risk unit. Accordingly,
probabilities were estimated on a “per apple” basis.97
iii.
The IRA Team took into account uncertainty
See Appellate Body Report, Australia – Salmon, para. 124: “likelihood may be expressed either
quantitatively or quantitatively”.
95
The Appellate Body in Australia – Salmon considered both terms to have the same meaning (para. 123).
96
A Monte Carlo stochastic (random) simulation model was used with @RISK, based on random sampling
from a set of values.
97
No guidance is provided by the ISPMs on this issue.
94
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Australia – Apples (DS367)
92.
Australia’s First Written Submission of Australia
18 July 2008
Frequently, the IRA Team did not use single point values to represent the probability of
an event occurring, but rather used a range of values, or distributions, which took account of
variation and uncertainty. ISPM No. 11 emphasises the need to address areas of uncertainty in
risk assessments, stating that:
… [e]stimation of the probability of introduction of a pest and of its economic
consequences involves many uncertainties. In particular, this estimation is an
extrapolation from the situation where the pest occurs to the hypothetical
situation in the PRA area. It is important to document the areas of uncertainty
and the degree of uncertainty in the assessment, and to indicate where expert
judgment has been used.98
a.
93.
Uniform and triangular distributions
The IRA Team used uniform distributions in cases where there was insufficient evidence
available to allow it to determine a most likely value for the probability of an event occurring. A
uniform distribution indicates that the probability of a particular event occurring is equally likely
to be any probability value within the minimum and maximum range of the distribution.
94.
The IRA Team used triangular distributions in cases where there was sufficient evidence
available to allow the Team to exercise its judgment to determine a “most likely value”. A
triangular distribution has a maximum, a most likely and a minimum value.
iv.
95.
The IRA assessed the probability of importing infected or infested apples
The first element of the pathway examined by the IRA Team was the importation
scenario comprised of the following eight importation steps (Importation steps 1 – 8):99
Importation step 1: proportion of orchards in which the pest is present;
Importation step 2: proportion of fruit coming from an infected or infested orchard that is
infected or infested with the pest;
Importation step 3: proportion of clean fruit that is contaminated during picking and
transport to the packing house (during picking and transfer to the packing house, apples
that are not carrying pests may be contaminated by, for example, pests on pickers’ hands,
picking bags and field boxes);
98
99
Exhibit AUS-6: ISPM No.11. (emphasis added)
Exhibit AUS-13: Diagram of importation steps for apple fruit.
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Australia’s First Written Submission of Australia
18 July 2008
Importation step 4: proportion of infected or infested fruit that remains infected or
infested after routine processing procedures in the packing house (apples would be
subjected to several operations in the packing house which may reduce the number of
pests present or the number of apples carrying a particular pest);
Importation step 5: proportion of clean fruit that is contaminated during processing in the
packing house (processes may increase the number of apples carrying a pest or the
numbers of pests on individual apples, for example, a water dump that is contaminated
with bacteria may result in clean apples being contaminated with the pest);
Importation step 6: proportion of infected or infested fruit that remains infected or
infested during palletisation, quality inspection, containerisation and transportation to
Australia (depending on the pest, some of these operations may reduce the number of
apples carrying pests or the number of pests present on individual apples);
Importation step 7: proportion of clean fruit that is contaminated during palletisation,
quality inspection, containerisation and transportation (some of these operations could
result in an increase in the number of apples carrying pests);
Importation step 8: proportion of infected or infested fruit that remains infected or
infested after on-arrival minimum border procedures.
96.
The IRA Team estimated probability values for each of the Importation steps on a “per
apple” basis, generally using distributions to take account of variation and uncertainty.
a.
97.
The IRA Team assessed volume of trade
The IRA Team needed to relate its evaluation of probabilities on a per apple basis to the
number of apples that might be imported from New Zealand. It considered that a 12-month
period was a convenient interval with which to estimate the potential volume of trade in apples.
98.
As there is no existing trade in apple fruit from New Zealand to Australia, the volume of
apples that might be imported during a 12 month period was difficult to estimate. In doing so,
the IRA Team took into account the nature of the market for apples in Australia; fluctuations in
Australia’s apple production from year to year because of climatic and environmental influences;
factors influencing the capacity of New Zealand to supply apples; including the varieties of
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Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
apples exported by New Zealand; and developments in the world apple market. Having assessed
these factors, the IRA Team estimated the most likely annual volume of trade to be 150 million
apples (approximately 27,000 tonnes).
99.
The IRA Team did not use 150 million apples as the only input. It represented volume of
trade by using a Pert distribution, with a minimum value of 50 million apples, a most likely value
of 150 million apples and a maximum value of 400 million apples.100 A Pert distribution was
used in response to submissions from New Zealand on the level of trade it expected to occur.
The Final IRA Report advises that the final distribution:
… gives significantly more emphasis to the lower end of the volume range but
does allow for volumes higher than that suggested by New Zealand at the
higher end.101
v.
The IRA Team assessed the proximity of major handlers and users of
apples to host plants for pests
100.
With the probability of importation of a pest determined, the IRA Team then analysed
how apples would be distributed, used and subsequently disposed of as waste. This established
the likelihood that major handlers and users of apples (utility points) would be located
sufficiently close to pest hosts (exposure groups) for transfer of pests from apples discarded by
handlers and users to host plants to take place (likelihood given as a proximity value).
101.
The IRA Team identified five different utility points: orchard wholesalers; urban
wholesalers; retailers; food services; and consumers. It identified four different exposure groups
of plants: commercial fruit crops; nursery plants; household and garden plants; and wild and
amenity plants.
vi.
The IRA Team estimated the probability of transfer of a pest from a
discarded apple to a susceptible host plant (exposure)
102.
Having established proximity values, the IRA Team then evaluated the probability of
exposure. This involved estimating the likelihood of a successful transfer of a pest from a
discarded apple to a susceptible host plant. In doing so, the IRA Team took into account a range
100
Although a Pert distribution contains a most likely value as does a triangular distribution, the minimum,
most likely and maximum values of a Pert distribution are joined by a curve, rather than the straight lines of a
triangular distribution.
101
Final IRA Report, Part B, p. 19.
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Australia’s First Written Submission of Australia
18 July 2008
of factors, including: viability of the pest; survival mechanism of the pest; transfer mechanism(s)
of the pest; receptivity of host plants; and environmental conditions.
vii.
The IRA Team estimated the probability of a pest establishing on a host
plant
103.
The IRA Team did not consider that the successful transfer of a pest from a discarded
apple to a host plant would necessarily mean that the pest would establish (propagate) on the
host plant. The IRA Team separately evaluated the probability of pests becoming established on
host plants taking into account factors relevant to estimating the probability of exposure, such as
host receptivity and environmental conditions, as well as other factors, including the
reproductive strategy of the pest and minimum population of the pest needed for establishment.
viii.
104.
The IRA Team estimated the probability of a pest spreading to other hosts
The IRA Team did not consider that the successful establishment of a pest on a single
initial host plant would necessarily mean that the pest would spread to other hosts in a
geographical area. It undertook a separate evaluation of the probability of spread for each pest,
taking into account several factors, including: suitability of the natural and/or managed
environment for natural spread of the pest; presence of natural barriers; the potential for
movement with commodities or conveyances; potential vectors of the pest; and potential natural
enemies of the pest.
ix.
The IRA Team varied the methodology for apple leaf curling midge to
account for a different biology
105.
The IRA Team used the methodology for determining PEES outlined above for fire
blight and European canker. The IRA Team varied the methodology for ALCM 102 because its
capacity to fly meant it would not necessarily remain associated with individual apples and it
could therefore enter the environment from several points along the pathway. Furthermore,
ALCM’s lifecycle and the environmental conditions necessary for its successful entry,
establishment and spread differ considerably to fire blight and European canker.
x.
102
Calculation of the probability of entry, establishment and spread
Final IRA Report, Part B, pp. 33-35.
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Australia – Apples (DS367)
106.
Australia’s First Written Submission of Australia
18 July 2008
The volume of trade expressed as a Pert distribution, the probability for importation, the
proximity values, the probability of transfer, the probability of establishment and the probability
of spread were combined using a stochastic (random) model running in @RISK. This involved
thousands of iterations, with each iteration combining individual probability values drawn from
the distributions for each factor. The outcome of this process was a distribution for the PEES.
3.
The IRA Team comprehensively and rigorously evaluated consequences
i.
107.
The IRA Team evaluated relevant types of consequences
Having determined the PEES for a pest, the IRA Team evaluated the consequences of an
incursion by that pest. Annex A(4) of the SPS Agreement requires the evaluation of the potential
biological and economic consequences associated with the incursion of a pest. Article 5.3 of the
SPS Agreement identifies certain factors that are required to be taken into account when
evaluating the economic consequences of a pest incursion, including the potential damage in
terms of lost production or sales and costs of control or eradication of the pest.
108.
ISPM No. 11 distinguishes between direct effects of a pest which are host-specific and
indirect effects of a pest which are not host-specific. The former focus on the biological impact
of a pest on hosts and the latter focus on the economic and broader environmental effects of a
pest incursion. The range of potential economic effects include: impacts on domestic and export
markets; including in particular effects on export market access; changes to producer costs,
including control costs; and changes to domestic or foreign consumer demand for a product
resulting from quality changes.
109.
Taking into account Article 5.3 of the SPS Agreement and ISPM No. 11, the IRA Team
evaluated the potential direct consequences of a pest incursion on host plants and the
environment and the potential indirect consequences of such an incursion as represented by: the
costs of control or eradication; impact on domestic and international trade; indirect impacts on
the environment from, for example, control measures using chemicals; and reduced rural and
regional economic viability.
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Australia – Apples (DS367)
ii.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team rigorously applied a sound and transparent qualitative
methodology
110.
The SPS Agreement does not prescribe a methodology for evaluating consequences.
Accordingly, a Member may adopt either a qualitative or quantitative methodology to doing so.
The IRA Team rigorously applied a sound and transparent qualitative methodology to evaluate
consequences.
iii.
The IRA Team assessed consequences at the local, district, regional and
national level
111.
The IRA Team evaluated direct and indirect consequences of a pest incursion at the local
level (an aggregate of households or enterprises), district level (a geographically or geopolitically
associated collection of aggregates), region level (a geographically or geopolitically associated
collection of districts) and national level (Australia wide).
112.
The IRA Team evaluated direct and indirect consequence at each of these levels. At each
level, the impact was assessed to be either “unlikely to be discernible”, “of minor significance”
(effects generally being reversible), “significant” (effects may not be reversible), or “highly
significant” (effects unlikely to be reversible).103 These impacts were translated into an overall
impact score (A to G) for each direct and indirect consequence through recourse to Table 10 in
the Final IRA Report.104
iv.
113.
The IRA Team reached overall estimate of consequences for each pest
After obtaining an impact score for each direct and indirect consequence, the IRA Team
applied an established set of decision rules to estimate whether the overall consequence of a pest
incursion 105 was negligible, very low, low, moderate, high or extreme.
v.
The IRA Team used a transparent risk estimation matrix to combine
likelihood and consequences
103
Final IRA Report, Part B, p. 38.
Final IRA Report, Part B, p. 39.
105
Final IRA Report, Part B, pp 39-40.
104
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Australia – Apples (DS367)
114.
Australia’s First Written Submission of Australia
18 July 2008
As the SPS Agreement does not prescribe the methodology to be used in risk assessments,
Members may adopt their own methodology for combining likelihood and consequences. In
Australia’s case, the risk estimation matrix106 reproduced below in Table 2 is used to combine
the likelihood of the entry, establishment and spread of pests and the associated consequences.
This is used routinely for all Australian risk analyses and promotes transparency and
consistency.
Table 2: Risk Estimation Matrix Used by the IRA Team
Likelihood of entry,
establishment and spread
High
Moderate
Low
Very low
Extremely
low
Negligible
Negligible
risk
Negligible
risk
Negligible
risk
Negligible
risk
Negligible
risk
Negligible
risk
Negligible
Very low
risk
Very low
risk
Negligible
risk
Negligible
risk
Negligible
risk
Negligible
risk
Very low
Low risk
Low risk
Very low
risk
Negligible
risk
Negligible
risk
Negligible
risk
Low
Moderate
risk
Moderate
risk
Low risk
Very low
risk
Negligible
risk
Negligible
risk
Moderate
High risk
High risk
Moderate
risk
Low risk
Very low
risk
Negligible
risk
High
Extreme
risk
Extreme
risk
High risk
Moderate
risk
Low risk
Very low
risk
Extreme
Consequences of entry, establishment and spread
115.
Although the PEES for a pest is expressed quantitatively, it is equated to a qualitative
descriptor on the vertical axis of the risk estimation matrix by recourse to Table 12 in the Final
IRA Report.107
Table 12 divides the numerical range between 0 and 1 into “probability
intervals” and equates these intervals to qualitative descriptors appearing on the vertical axis.
For example, the interval between 0.7 and 1 is equated to “High” and the interval between 0 and
10-6 is equated to “Negligible”. The horizontal axis represents consequences with qualitative
descriptors ranging from “negligible” to “extreme”.
116.
The cells of the matrix provide an overall estimate of risk for different combinations of
likelihood and consequences. The band of cells marked “very low” in the matrix reflects
Australia’s ALOP. Risks above very low (i.e. low, moderate, high and extreme) require the
application of risk management measures in order for Australia to achieve its ALOP.
106
107
Final IRA Report, Part B, p. 4.
Final IRA Report, Part B, p. 43.
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Australia – Apples (DS367)
vi.
117.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team determined unrestricted risk
The IRA Team used the matrix to determine the unrestricted annual risk associated with
each pest if New Zealand apples were imported without phytosanitary measures.
If the
unrestricted annual risk exceeded Australia’s ALOP (represented by the cells marked “very
low”), then the IRA Team considered measures to mitigate the risk to achieve Australia’s ALOP.
vii.
The IRA Team evaluated measures to mitigate unrestricted risk to achieve
Australia’s ALOP
118.
In considering risk mitigation measures, the IRA Team identified which importation
steps significantly influenced the number of infested/infected apples likely to be imported. It
then assessed the impact of individual measures in reducing the likelihoods associated with these
steps in order to mitigate the unrestricted annual risk to a level which achieved Australia’s
ALOP. Where individual measures did not mitigate the risk sufficiently, a systems approach
was applied, integrating measures with a cumulative effect so as to achieve Australia’s ALOP. 108
4.
The IRA Team concluded that risk mitigation measures were required
119.
The IRA Team concluded that fire blight, European canker, ALCM and a number of
other pests would require specific risk mitigation measures to reduce the risk associated with
these pests to a level that achieves Australia’s ALOP. The final chapter of the Final IRA Report
details the principal measures and the operational and verification requirements.109
120.
The IRA Team recommended that the import conditions for New Zealand apples should
be reviewed after the first year of trade, with further reviews if warranted.110
108
Exhibit AUS-14: International Plant Protection Convention, International Standard for Phytosanitary
Measures No. 14: The use of integrated measures in a systems approach for pest risk management, 2002.
109
“Risk management and operational framework”, Final IRA Report, Part B, pp. 313-325. Also, at the
end of each chapter on particular pests in Part B of the Final IRA Report, the principal measures are evaluated.
110
Final IRA Report, Part B, p. 325.
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18 July 2008
V.
LEGAL FRAMEWORK
121.
Before turning to Australia’s substantive arguments in response to New Zealand’s
submission, it is necessary to deal with certain critical issues relevant to the interpretation and
application of the SPS Agreement. Clear identification of the relevant product and the measures
in relation to each particular obligation is required, and the burden of proof and the related
standard of review to be exercised by the Panel need to be established. New Zealand largely
ignores these issues, but they are central to a balanced interpretation and application of the SPS
Agreement. Australia’s arguments on these issues are outlined below.
122.
Australia’s detailed legal and factual rebuttal to New Zealand’s claims under Articles 2.2,
2.3, 5.1, 5.2, 5.5, 5.6 and 8 and Annex C(1)(a) is outlined in Part VI of this submission in respect
of each of the pests at issue in this dispute.
A.
THE PRODUCT AT ISSUE IN THIS DISPUTE IS MATURE APPLES
123.
Australia considers that the product at issue in this dispute should be determined by
reference to the scope of the Final IRA Report, which was “mature apple fruit free of trash,
either packed or sorted and graded bulk fruit from New Zealand.”111 New Zealand’s attempt to
characterise the product at issue as “mature, symptomless apples”112 and its use of terms which
may limit the mode of trade to “retail ready” or “just in time” apples113 should be rejected by the
Panel.
124.
The mode of trade was discussed by Australia and New Zealand during the production of
the Final IRA Report. However, in response to requests for clarification, New Zealand was
unwilling to limit trade to “retail ready” or “just in time” apples, and would not rule out the
importation of bulk fruit that may be stored, graded and/or packed in Australia.114
111
Final IRA Report, Part B, p. 9.
New Zealand’s first written submission, para. 3.44.
113
See: New Zealand’s first written submission, paras. 4.74, 4.129, 4.285, 4.357, 4.361 & 4.418.
114
The mode of trade issue is addressed on p. 9 of Part B of the Final IRA Report. The IRA Team made no
assumptions as to the mode of trade.
112
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18 July 2008
B.
THE MEASURES AT ISSUE LIMIT THE SCOPE OF THIS DISPUTE
125.
The measures at issue define the scope of a dispute and therefore warrant careful
consideration by the Panel. As Australia will show, one of the measures identified by New
Zealand in relation to European canker is not in fact a measure required by Australia. Further, in
two instances, New Zealand has misunderstood the requirements actually imposed by Australia.
In one of these instances, there is no live dispute because what Australia requires is what New
Zealand accepts as satisfactory. In relation to another measure, New Zealand mischaracterises
the requirement. The Panel will need to carefully review New Zealand’s identification of the
measures at issue in order to satisfy itself as to the precise measures the subject of the dispute.
126.
Further, New Zealand has not sufficiently established that each measure at issue is an
SPS measure that is subject to the disciplines of the SPS Agreement, nor that each measure is
individually challengeable in WTO dispute settlement proceedings.
127.
Australia elaborates on these issues below. A consequence of Australia’s submissions is
that the dispute is not as broad as New Zealand seeks to make it, particularly in light of the
Panel’s preliminary ruling. Nor are the measures imposed as onerous as New Zealand suggests.
1.
The Panel’s terms of reference are limited to the 17 measures specifically identified
in New Zealand’s panel request
(a)
128.
New Zealand disregards the consequences of the Panel’s preliminary ruling
In its preliminary ruling of 6 June 2008, the Panel found that:
New Zealand’s panel request does not identify with sufficient precision any
measures contained in Australia’s [Final IRA Report], other than the 17
specific items identified through bullet points. Accordingly, any such other
measures are not part of this Panel’s terms of reference…115
129.
This ruling has consequences that New Zealand appears to ignore. The Panel’s rejection
of New Zealand’s assertion that it was challenging the “Final IRA as a whole”
116
means that
New Zealand may not challenge any other “measures” which may be “specified in and required
Preliminary Ruling of the Panel, Australia – Apples, 6 June 2008, WT/DS367/7, para. 13(b).
Written Submission of New Zealand, Request for a preliminary procedural ruling in relation to the
consistency of New Zealand’s panel request with Article 6.2 of the DSU, WT/DS367, 7 April 2008, paras. 2.9-2.10.
115
116
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18 July 2008
by Australia pursuant to the [Final IRA Report]”, other than the 17 measures specifically
identified in its panel request. The Panel’s ruling also means that the “measures at issue” in this
dispute do not include the Final IRA Report itself. New Zealand cannot treat a reference to the
Final IRA Report in its panel request as equivalent to identifying the Final IRA Report, or the
process by which it was produced, as a “measure at issue”.117
(b)
New Zealand has not established that all measures are challengeable under
the relevant provisions of the SPS Agreement
130.
Australia notes that New Zealand has only made a general claim that:
Australia’s [17] measures … are clearly “phytosanitary measures”, as defined
in the SPS Agreement, because they constitute measures “to protect…plant life
or health…from the risks arising from the entry, establishment or spread of
pests, diseases, disease-carrying organisms” within the meaning of paragraph
1(a) of Annex A and measures “to prevent or limit other damage within the
territory of the Member from the entry, establishment or spread of pests”
within the meaning of paragraph 1(d) of Annex A.118
131.
Australia does not consider such a general statement to be an adequate basis on which the
Panel should accept that each of the 17 measures challenged meets the definition of “SPS
measure” set out in Annex A(1) of the SPS Agreement. There is little purpose in the SPS
Agreement explicitly defining the term “SPS measure” if its provisions could be applied to any
measure challengeable in WTO dispute settlement. The onus is on New Zealand to establish that
each of the measures challenged, individually and as a whole,119 meets the definition of “SPS
measure”. New Zealand must also satisfy the Panel in respect of each of the “measures” it has
challenged that it is a “procedure to check and ensure the fulfilment of” SPS measures, in order
to sustain claims under Article 8 and Annex C(1). This is one of many instances where New
Zealand does not discharge its burden of proof.
2.
Australia does not impose the pruning requirement alleged by New Zealand in
respect of European canker
132.
In respect of European canker, New Zealand challenges:
See: Written Submission of Australia, Response to New Zealand’s submission: Request for a
preliminary procedural ruling in relation to the consistency of New Zealand’s panel request with Article 6.2 of the
DSU, DS367, 14 April 2008, paras. 8-12.
118
New Zealand’s first written submission, para. 3.87. (footnote omitted)
119
New Zealand’s first written submission, para. 3.89.
117
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18 July 2008
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of
European canker.120
133.
However, Australia does not impose such a requirement. New Zealand has pointed to
page 154 of the Final IRA Report as support for its assertion. However, the only reference to the
risk of growers pruning in an attempt to remove or hide symptoms of European canker on page
154 of the Final IRA Report appears as follows:
A stakeholder raised the possibility of growers pruning out any diseased twigs
and branches before inspection. The inspection proposed needs to occur after
autumn leaf fall but before winter pruning. This is reflected in the
requirements set out in the operational framework section.121
134.
Clearly, this statement does not amount to evidence that Australia imposes a requirement
for suspension following pruning.
And no such requirement is set out in the operational
framework section of the Final IRA Report. Australia therefore submits that the Panel should
find that New Zealand has failed to establish that Australia imposes such a requirement and as a
result no findings can be made in respect of such a measure in this dispute. This leaves only 16
measures at issue.
3.
New Zealand cannot challenge some of the “measures at issue” individually
135.
New Zealand apparently challenges “each of the measures …, individually and as a
whole”.122
However, in Australia’s view, a number of the “measures” identified by New
Zealand cannot be challenged on an individual basis.
136.
Australia recalls that, in the US – Export Restraints dispute, Canada challenged four
elements of an alleged United States’ “practice” in respect of export restraints. Canada argued
that:
… each of the elements that it cite[d] (the statute, the SAA, the Preamble, and
US practice) individually constitutes a measure that is susceptible to dispute
settlement, and that, “taken together” as well, these elements constitute a
measure.123
120
New Zealand’s first written submission, para. 3.83; New Zealand, Request for the Establishment of a
Panel by New Zealand, WT/DS367/5 (7 December 2007) (“New Zealand’s panel request”), p. 2.
121
Final IRA Report, Part B, p. 154.
122
New Zealand’s first written submission, para. 3.89.
123
Panel Report, US – Export Restraints, para. 8.82.
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Australia – Apples (DS367)
137.
Australia’s First Written Submission of Australia
18 July 2008
The panel analysed whether “each of the measures that [Canada] identified … operates
individually to require [the alleged] treatment”124, and reasoned as follows:
In considering whether any or all of the measures individually can give rise to
a violation of WTO obligations, the central question that must be answered is
whether each measure operates in some concrete way in its own right. By this
we mean that each measure would have to constitute an instrument with a
functional life of its own...125
138.
Australia submits that the Panel should apply the same approach to determining whether
each of the measures at issue can be challenged both “individually and as a whole”.
i.
139.
Measures applicable to fire blight
Australia has adopted a “systems approach” with respect to managing the risks associated
with fire blight, requiring:
New Zealand apples to be sourced from orchards free from symptoms of fire
blight, requiring orchards to be visually inspected (once annually) at an
intensity that would, at a 95% confidence level, detect visible symptoms if
shown by 1% of the trees, with the inspection to take place between 4 to 7
weeks after flowering (when conditions for fire blight disease development are
likely to be optimal); the detection of any visible symptoms of fire blight will
result in the suspension of the orchard/block for the season; and
the use of disinfection treatment (for example complete immersion in a water
solution containing a minimum of 100ppm available chlorine for a minimum
of one minute) in the packing house to remove existing surface contamination
with fire blight bacteria and prevent further contamination.126
140.
The Final IRA Report also recommends a number of ancillary procedures to support,
verify and operationalise this systems approach.
New Zealand challenges certain of these
requirements as follows:
The requirement that an orchard/block inspection methodology be developed
and approved that addresses issues such as visibility of symptoms in the tops
of trees, the inspection time needed and the number of trees to be inspected to
meet the efficacy level, and training and certification of inspectors.
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of fire
blight.
124
125
Panel Report, US – Export Restraints, para. 8.84.
Panel Report, US – Export Restraints, para. 8.85. (emphasis added) The panel’s decision was not
appealed.
126
See: Final IRA Report, Part A, p. 15; Part B, p. 318.
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18 July 2008
The requirement that all grading and packing equipment that comes in direct
contact with apples be cleaned and disinfected (using an approved disinfectant)
immediately before each Australian packing run.
The requirement that packing houses registered for export of apples process
only fruit sourced from registered orchards.127
141.
In Australia’s view, none of these four requirements “operates in some concrete way in
its own right”128, because each is designed to implement or maintain the principal risk
management measures. These four ancillary requirements cannot therefore individually give rise
to a violation of WTO obligations and therefore cannot be challenged individually. Accordingly,
the Panel should only assess these requirements when “taken together” (or “as a whole”) with the
principal measures for fire blight.
ii.
142.
Measures applicable to European canker
In order to address the risks associated with European canker, Australia requires:
The proposed risk management measure is to allow export only from pest free
places of production. Pest freedom would require a winter inspection of
orchards before pruning of trees to confirm freedom. Detection of European
canker would result in suspension of exports from that orchard/block for the
coming season. Reinstatement would require eradication of the disease,
confirmed by inspection.129
143.
New Zealand challenges:
The requirement that all new planting stock be intensively examined and
treated for European canker.
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of
European canker.130
144.
Australia considers that the first requirement identified by New Zealand is designed to
support the principal measure for European canker, and thus is not challengeable on an
individual basis. Accordingly, the Panel should only assess this ancillary requirement when
“taken together” (or, “as a whole”) with the principal measure. Australia has already established
that it does not impose the requirement as stated in relation to pruning.
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, pp. 1 & 2.
Panel Report, US – Export Restraints, para. 8.85.
129
See: Final IRA Report, Part A, p. 15.
130
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 2.
127
128
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iii.
145.
Australia’s First Written Submission of Australia
18 July 2008
General measures
The Final IRA Report also recommends a number of general operational procedures to
support the principal risk management measures for the quarantine risks identified in that
document. New Zealand has challenged:
The requirement that Australian Quarantine and Inspection Service officers be
involved in orchard inspections for European canker and fire blight, in direct
verification of packing house procedures, and in fruit inspection and treatment.
The requirement that New Zealand ensure that all orchards registered for
export to Australia operate under standard commercial practices.
The requirement that packing houses provide details of the layout of
premises.131
146.
Australia submits that none of these requirements operate in a concrete way in its own
right, and therefore cannot be challenged on an individual basis. Accordingly, the Panel should
only assess these requirements when “taken together” (or, “as a whole”) with the principal risk
management measures recommended in the Final IRA Report.
147.
As Australia will show, the categorisation of certain “measures” as mere ancillary
requirements has implications for New Zealand’s claims under Article 2.2 and Article 5.1.
4.
New Zealand’s description of certain “measures” imposed by Australia is flawed
148.
In Australia’s view, New Zealand has mischaracterised or misunderstood a number of
Australia’s requirements for the importation of New Zealand apples.
(a)
New Zealand has misunderstood the nature of AQIS involvement in orchard
inspections
149.
In respect of measures applicable to all pests, New Zealand challenges:
The requirement that Australian Quarantine and Inspection Service [AQIS]
officers be involved in orchard inspections for European canker and fire blight,
in direct verification of packing house procedures, and in fruit inspection and
treatment.132
131
132
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 3.
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 3.
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Australia – Apples (DS367)
150.
Australia’s First Written Submission of Australia
18 July 2008
Australia considers that New Zealand has misunderstood what its requirement would
mean in practice. New Zealand apparently considers that Australia’s measure “require[s] the
involvement of AQIS officials in all [orchard] inspections.”133 New Zealand has further claimed
that “the requirement for AQIS involvement would double the number of inspectors and more
than double the cost of orchard and packing house operations.”134
151.
Australia acknowledges that the level and precise nature of “AQIS involvement” was not
defined in the Final IRA Report. However, contrary to New Zealand’s mistaken perception,
Australia’s requirement does not require the involvement of AQIS officials in all orchard
inspections and packing house operations. Rather, AQIS activities are to be by way of systems
audits.135 For orchard inspections, the audit would include 100% of survey teams in the field,
and the intensity of audits would be adjusted over time based on performance. For packing
houses, all relevant packing houses would be audited in their first year of trade.
152.
The requirement for AQIS to conduct such systems audits is to be facilitated by another
of the “measures” challenged by New Zealand:
The requirement that packing houses provide details of the layout of
premises.136
153.
This requirement is for packing houses to provide a basic map of the layout of their
premises, so that AQIS officers can identify areas of potential risk in preparation for the required
packing house audits.
154.
Australia notes that AQIS clarified these requirements on a number of occasions during
bilateral discussions on the standard operating procedure (SOP) in 2007 and early 2008.
155.
In its first written submission, New Zealand indicates that it would not object to systems
audits by AQIS officials as an “alternative” to the requirement of “AQIS involvement”. 137 New
Zealand’s description of such systems audits138 accords with Australia’s view of its requirement
New Zealand’s first written submission, para. 4.459. (original emphasis)
New Zealand’s first written submission, para. 4.535.
135
This is explained in the Final IRA Report as follows: “AQIS field audits will measure compliance with
orchard registration, block identification, pest/disease management/monitoring, records management, and the
administration of the area freedom and accreditation requirements.” (Final IRA Report, Part B, p. 314.)
136
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 3.
137
New Zealand’s first written submission, para. 4.525.
138
See: New Zealand’s first written submission, para. 4.527.
133
134
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and accordingly there is no live dispute with respect to this measure. This leaves 15 measures at
issue.
(b)
New Zealand has mischaracterised Australia’s principal requirement in
respect of fire blight
156.
New Zealand has described one of the measures it challenges in respect of fire blight, as:
The requirement that apples be sourced from areas free from fire blight disease
symptoms.139
157.
Throughout its submission, New Zealand refers to this measure as a requirement for
“area freedom”140. Australia considers that the term “area freedom” is analogous to the “pest
free area” concept in ISPM No. 4 – that is, “an area in which a specific pest does not occur as
demonstrated by scientific evidence and in which, where appropriate, this condition is being
officially maintained”.141 Australia does not require that the relevant area be free of the disease –
merely its visible symptoms. As the Final IRA Report notes142, the concept of an “area free of
disease symptoms”, is distinct from “pest free areas” and the similar “pest free places of
production” (ISPM No. 10).
158.
Australia’s precise requirement is that New Zealand apples be sourced from areas free
from visible symptoms of fire blight during the period between 4 to 7 weeks after flowering.143
This requirement reflects the concept of “low pest prevalence”.
ISPM No. 22 addresses
“requirements for the establishment of areas of low pest prevalence”. It states:
The establishment of an area of low pest prevalence (ALPP) is a pest
management option used to maintain or reduce a pest population below a
specified level in an area. An ALPP may be used to facilitate exports or to
limit pest impact in the area.144
159.
The specified pest level in this case is “freedom from visible symptoms”. That is,
Australia is prepared to tolerate the existence of E. amylovora in the areas from which New
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 1.
New Zealand’s first written submission, paras. 4.33 & 4.39.
141
ISPM No. 4, p. 37.
142
Final IRA Report, Part B, p. 106.
143
See: Final IRA Report, Part B, pp. 106 & 316.
144
ISPM No. 22, p. 265.
139
140
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Zealand apples are sourced up to the point where disease symptoms are visible in the period
between 4 to 7 weeks after flowering.
160.
Australia asks that the Panel bear in mind the distinction between an orchard that is
“free” of the bacteria, E. amylovora, and an orchard that is merely “free” of fire blight symptoms
– a distinction which New Zealand appears to blur in its submission.
(c)
New Zealand has misunderstood the fire blight requirement in respect of
pruning
161.
New Zealand challenges:
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of fire
blight.145
162.
The Final IRA Report expresses the requirement as follows:
Any evidence of pruning or other activities carried out before the inspection
that could constitute an attempt to remove or hide symptoms of fire blight
would result in the suspension of the orchard/block for the season.146
163.
New Zealand’s omission of the word “that” changes the nature of this requirement. 147
Australia’s requirement is not that any evidence of pruning before the inspection will be taken by
Australia as an attempt to remove symptoms of fire blight, resulting automatically in suspension
of that orchard/block for the season. An orchard/block would only be suspended on evidence of
pruning before the inspection if AQIS officers believe that the pruning in that instance may have
been an attempt to hide symptoms of fire blight.
(d)
New Zealand has mischaracterised the European canker requirement in
respect of planting stock
164.
New Zealand challenges:
New Zealand’s first written submission, para. 3.83; also, see para. 4.38; New Zealand’s panel request, p.
2. (emphasis added)
146
Final IRA Report, Part B, p. 316. (emphasis added)
147
New Zealand’s first written submission, para 4.38. Australia notes that New Zealand also omitted the
word “that” from their expression of the like (alleged) requirement in relation to European canker, giving the same
impression as in relation to the requirement for fire blight (see: New Zealand’s first written submission, para. 3.83;
New Zealand’s panel request, p. 2). However, as will be argued in the following section, New Zealand has not
established that Australia imposes such a requirement in relation to European canker.
145
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The requirement that all new planting stock be intensively examined and
treated for European canker.148
165.
However, the requirement imposed by Australia is characterised in the Final IRA Report
as follows:
All new planting stock must be intensively examined, and appropriate cultural
practices and fungicide sprays used to minimise the likelihood of canker
infections.149
5.
Conclusion on the measures at issue
166.
Australia submits that it is clear from the arguments above that this dispute is
considerably more narrow than what New Zealand has sought to assert. There are 15 measures
at issue, the descriptions of which Australia has clarified above. In addition, not all of the 15
measures can be challenged individually. If the Panel accepts Australia’s views on the measures
at issue in this dispute, then this should be reflected in the Panel’s analysis and conclusions.
C.
THE BURDEN OF PROOF IS ON NEW ZEALAND
167.
It is a well-established principle that the “burden of proof rests upon the party, whether
complaining or defending, who asserts the affirmative of a particular claim or defence.” 150 The
initial burden lies on the complaining party.151 This reflects the principle that Members’
measures are presumed to be consistent with their WTO obligations unless sufficient evidence is
presented to the contrary.152 In Canada – Dairy (Article 21.5 – New Zealand and US II), the
Appellate Body stated:
[The complaining] Member must make out a prima facie case by presenting
sufficient evidence to raise a presumption in favour of its claim. If the
complaining Member succeeds, the responding Member may then seek to
rebut this presumption.153
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 2.
Final IRA Report, Part B, p. 154.
150
Appellate Body Report, US – Wool Shirts and Blouses, p. 14.
151
Appellate Body Report, EC – Hormones, para. 98.
152
Appellate Body Report, Canada – Dairy (Article 21.5 – New Zealand and US II), para. 66. See also,
Appellate Body Report, US – Wool Shirts and Blouses, p. 14.
153
Appellate Body Report, Canada – Dairy (Article 21.5 – New Zealand and US II), para. 66. See also,
Appellate Body Report, US – Wool Shirts and Blouses, p. 14.
148
149
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168.
Australia’s First Written Submission of Australia
18 July 2008
The Appellate Body has reaffirmed these principles for cases under the SPS
Agreement.154
169.
Australia’s measures should therefore be presumed to be consistent with the SPS
Agreement.
New Zealand bears the burden of establishing a prima facie case that those
measures are inconsistent with the SPS Agreement.
Only if New Zealand successfully
establishes a prima facie case will the evidentiary burden shift to Australia to rebut the
inconsistencies asserted by New Zealand. In US – Gambling, the Appellate Body elaborated that
a prima facie case:
…must be based on “evidence and legal argument” put forward by the
complaining party in relation to each of the elements of the claim. A
complaining party may not simply submit evidence and expect the panel to
divine from it a claim of WTO-inconsistency. Nor may a complaining party
simply allege facts without relating them to its legal arguments.155
170.
New Zealand submits particular “evidence” without any rigorous analysis to show how
this evidence demonstrates any inconsistency with the SPS Agreement. New Zealand is required
to discharge its burden of proof in relation to each measure under each provision of the SPS
Agreement relevant to its claims.
171.
Australia submits that New Zealand has failed to meet its burden of proof, by failing to
present evidence and legal argument sufficient to demonstrate a prima facie case that the
challenged measures are inconsistent with Australia’s obligations under the SPS Agreement.
D.
IT IS IMPORTANT TO APPLY THE APPROPRIATE STANDARD(S) OF REVIEW
1.
New Zealand fails to address the crucial issue of standard of review
172.
Closely related to the burden of proof is the standard(s) of review that should be applied
by the Panel in this dispute. New Zealand’s submission is entirely silent on the issue.
173.
The standard of review refers to the appropriate nature and degree of a panel’s scrutiny of
the underlying basis for a Member’s measures. In the context of the SPS Agreement, SPS
154
Appellate Body Report, Japan – Apples, para. 152. See also, Appellate Body Report, EC - Hormones,
155
Appellate Body Report, US – Gambling, para. 140. (footnotes omitted; original emphasis)
para. 98.
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measures are required to be science-based and a Member has regulatory discretion as to how best
to address risks to human, animal or plant life or health that have been identified through risk
assessment.
Determining the appropriate standard(s) of review at the outset is important
because, as the Appellate Body has noted, “[a] failure to apply the proper standard of review
constitutes legal error under Article 11 of the DSU.”156
174.
According to the Appellate Body, “Article 11 of the DSU lays down the standard of
review for panels in disputes under the [WTO] covered agreements”.157 Article 11 of the DSU
directs a panel to make “an objective assessment of the facts of the case”, inter alia. In EC –
Hormones, the Appellate Body explained that Article 11 of the DSU imposed certain limits on
the standard of review that a panel may adopt in its fact-finding role, stating that:
So far as fact-finding by panels is concerned, their activities are always
constrained by the mandate of Article 11 of the DSU: the applicable standard
is neither de novo review as such, nor “total deference”, but rather the
“objective assessment of the facts”. Many panels have in the past refused to
undertake de novo review, wisely, since under current practice and systems,
they are in any case poorly suited to engage in such a review. On the other
hand, “total deference to the findings of the national authorities”, it has been
well said, “could not ensure an ‘objective assessment’ as foreseen by Article
11 of the DSU”.158
175.
But this standard of “objective assessment” is couched in broad terms and provides
limited guidance on the precise nature and intensity of the review required of a panel in its factfinding role. Australia submits that the standard of review should be informed by the particular
covered agreement(s) and obligation(s) at issue in a given dispute.159
2.
The standard of review is informed by the relevant obligation and covered
agreement
176.
Australia submits that the precise nature of what is required by an “objective assessment
of the facts” varies across the covered agreements and may also vary across particular
Appellate Body Report, US – Countervailing Duty Investigation on DRAMS, para. 187.
Appellate Body Report, US – Cotton Yarn, para. 68.
158
Appellate Body Report, EC – Hormones, para. 117. (footnotes omitted)
159
Australia notes that the Anti-Dumping Agreement is the only covered agreement with explicit language
on standard of review. See: Article 17.6(i), Agreement on Implementation of Article VI of the General Agreement
on Tariffs and Trade 1994 (“Anti-Dumping Agreement”). Also, see: Appellate Body Report, EC – Hormones, para.
114.
156
157
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obligations within the same agreement. Australia finds support for its view in the statement by
the Appellate Body in US – Softwood Lumber VI (Article 21.5 – Canada), as follows:
[T]he proper standard of review to be applied by a panel must … be
understood in the light of the specific obligations of the relevant agreements
that are at issue in the case.160
177.
Therefore, the standard of review applied by a panel must reflect not only Article 11 of
the DSU, but also the content of the covered agreement and particular obligation in question.
178.
For example, the Appellate Body has opined on how panels should apply the standard of
review mandated by Article 11 of the DSU in the context of disputes under Article 4.2(a) of the
Agreement on Safeguards.161 In US – Lamb, the Appellate Body explained a panel’s role in
relation to standard of review in that context, as follows:
[T]he precise nature of the examination to be conducted by a panel, in
reviewing a claim under Article 4.2 of the Agreement on Safeguards, stems, in
part, from the panel’s obligation to make an “objective assessment of the
matter” under Article 11 of the DSU and, in part, from the obligations imposed
by Article 4.2, to the extent that those obligations are part of the claim..162
179.
The need to apply standard(s) of review specific to the SPS Agreement was recognised by
the Appellate Body in the EC – Hormones dispute, where it stated that panels must “adopt a
standard of review … clearly rooted in the text of the SPS Agreement itself”.163
3.
The standard(s) of review must maintain the balance of rights and obligations under
the SPS Agreement
180.
The protection of human, animal or plant life or health is a fundamental non-trade right
of Members recognised by the SPS Agreement. The SPS Agreement essentially balances the
exercise of this right against the trade liberalisation goals of the WTO by requiring SPS measures
to be science-based, non-discriminatory and not more trade-restrictive than required.
181.
The SPS Agreement does not impose a requirement of uniformity, whereby all Members
are required to adopt the same SPS regulatory systems, methodologies or measures. Rather,
Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada), para. 92 (emphasis added).
Also, see: Appellate Body Report, US – Countervailing Duty Investigation on DRAMS, para. 184.
161
See: Appellate Body Report, Argentina – Footwear Safeguard, para. 121; Appellate Body Report, US –
Lamb, paras. 102-105.
162
Appellate Body Report, US – Lamb, para. 105; also, see paras. 102-104.
163
Appellate Body Report, EC – Hormones, para. 115.
160
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Members retained the flexibility to comply with their obligations under the SPS Agreement in a
manner which suits their particular circumstances and priorities.
182.
Application of the appropriate standard of review by panels to the assessment and
management of risks acknowledges that panels do not have the scientific or technical expertise,
or the resources, to evaluate risk under the SPS Agreement; and that they are not in a position to
settle scientific debates.
183.
Accordingly, Australia submits that where a Member has acted in good faith to comply
with its obligations under the SPS Agreement, a panel, in its fact-finding role, should show a
degree of deference (but not total deference) in its review of that Member’s regulatory decisions.
4.
The SPS Agreement reflects a balance of jurisdictional competences
184.
Australia contends that the extent of deference to be shown by a panel can be ascertained
by examining the distribution of decision-making authority enshrined in the SPS Agreement for
the judgments required to assess and mitigate SPS risks in the territory of a Member. In EC –
Hormones, the Appellate Body recognised that a balance was struck between Members in
relation to the distribution of that decision-making authority, stating that:
[T]he standard of review appropriately applicable in proceedings under the
SPS Agreement … must reflect the balance established in that Agreement
between the jurisdictional competences conceded by the Members to the WTO
and the jurisdictional competences retained by the Members for themselves.164
185.
As Members retained certain jurisdiction to themselves, certain limitations are imposed
on the nature of scrutiny that panels may apply to their assessment of factual matters under
particular obligations, such as their review of risk assessments. In relation to certain other
obligations, however, no such limitation applies. Accordingly, the appropriate standard of
review may vary between different obligations in the SPS Agreement.
186.
In Australia’s view, this variation takes the form of a sliding scale in relation to the extent
to which a panel may intervene in certain assessments or regulatory judgments made or relied
upon by a Member in order to comply with its obligations under the SPS Agreement. The two
ends of this scale are de novo review and total deference, neither of which are permissible for an
164
Appellate Body Report, EC – Hormones, para. 115. (footnote omitted)
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“objective assessment of the facts”.165
Australia’s First Written Submission of Australia
18 July 2008
Australia contends that a panel’s jurisdictional
competence to review the findings of a risk assessment is considerably limited, but does not
amount to requiring “total deference” to those findings. By contrast, a panel has a different role
in reviewing a Member’s consistency with its obligations in relation to whether the application
of an SPS measure results in, for example, discrimination or a disguised restriction on
international trade. In relation to certain other regulatory judgments made by a Member, such as
a decision to base SPS measures on a particular risk assessment, the level of deference required
falls in between the deference required in the two above examples. These differing levels of
deference reflect the “balance … [of] jurisdictional competences”166 established in the SPS
Agreement.
187.
Australia submits that it is incumbent upon panels not to disturb that balance between
regulatory autonomy and international supervision. As the Appellate Body further observed in
EC – Hormones:
To adopt a standard of review not clearly rooted in the text of the
SPS Agreement itself, may well amount to changing that finely drawn balance;
and neither a panel nor the Appellate Body is authorized to do that.167
188.
In order to assist the Panel, Australia sets out its view on the appropriate standard of
review in relation to each of the obligations at issue in this dispute below.
5.
The Panel’s role where scientific judgment is not in issue
189.
Australia acknowledges that there are certain obligations in the SPS Agreement in
relation to which panels need show a relatively low level of deference to a decision by a
Member. These are obligations directed at meeting specific requirements or managing the trade
impact of the means by which a Member has sought to achieve particular ends, rather than
matters of scientific or regulatory judgment.
190.
Australia submits that those obligations include:

whether discrimination or a disguised restriction on international trade can be
established under either Article 2.3 or Article 5.5;
See: Appellate Body Report, EC – Hormones, para. 117.
Appellate Body Report, EC – Hormones, para. 115.
167
Appellate Body Report, EC – Hormones, para. 115.
165
166
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Australia – Apples (DS367)

Australia’s First Written Submission of Australia
18 July 2008
whether there is another measure, reasonably available taking into account
technical and economic feasibility, that is significantly less restrictive to trade,
under Article 5.6 and footnote 3 (but not whether that measure achieves a
Member’s ALOP, to be explained below); and

whether a Member has observed the requirements set out in Article 8 and Annex
C(1)(a) of the SPS Agreement.
6.
The standard of review in relation to assessing the scientific basis of SPS measures
evaluated in a risk assessment requires a panel to show considerable deference
(a)
The mandatory requirement for Members to obtain a risk assessment
excludes a panel from conducting the required risk assessment itself
191.
Australia submits that the most significant limitation imposed by the SPS Agreement on
the jurisdiction of panels as to their fact-finding role is in relation to their review of risk
assessments. Risk assessments provide an underlying justification for the adoption of SPS
measures and are required to evaluate certain factual material including the available scientific
evidence. The requirement for Members to “base” SPS measures on a risk assessment means
that an investigative and fact-finding process compulsorily precedes any assessment by a WTO
panel of the relevant scientific and other evidence. Where a Member has obtained and relied
upon a comprehensive and transparent risk assessment, it is incumbent on panels to accord
considerable deference (but not total deference) to that assessment.
192.
The requirement in Article 5.1 to “base” SPS measures on a risk assessment means there
is a positive obligation on all Members to obtain and rely upon a risk assessment that is
appropriate to the circumstances in order to justify the adoption of SPS measures to address a
particular risk.
In situations where no relevant international standards, guidelines or
recommendations exist, as in the present dispute, a Member does not enjoy the presumption of
consistency under the SPS Agreement which is provided by Article 3.2. In such circumstances,
the SPS Agreement provides no option but to obtain and rely upon a risk assessment (except in
the circumstances set out in Article 5.7).
193.
In Australia’s view, the expectation is that Members themselves will procure the
necessary risk assessments, where possible and appropriate. This is supported by the fact that
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the International Plant Protection Convention (IPPC) requires that “each contracting party shall
make provision, to the best of its ability, for an official national plant protection organization
with the main responsibilities … [to include] the conduct of pest risk analyses”.168 The IPPC
reflects an acknowledgment that Members themselves are best placed to assess the consequences
of risks to human, animal or plant life or health within their territory and the appropriate
regulatory response, and to reflect community expectations.
194.
Successive panels have recognised that they may not perform the risk assessment
mandated by Article 5.1 of the SPS Agreement.169 The panel in Japan – Apples (Article 21.5 –
US) acknowledged that “we are not supposed to conduct our own risk assessment or to impose
any scientific opinion on Japan.”170
Similarly, the panel in the Canada/US – Continued
Suspension dispute stated that:
The Panel recalls that it is not the appropriate role of the Panel to conduct its
own risk assessment based on scientific evidence gathered by the Panel or
submitted by the parties during the Panel proceedings.171
195.
It is clear that a Member must obtain a risk assessment and that a panel can never supply
that risk assessment. If a panel was to perform the risk assessment required under Article 5.1,
the jurisdictional competence expressly retained by Members in this regard would be nullified.
196.
For these reasons, Australia submits that the Panel must refrain from conducting a de
novo review of the evidence (that is, to assess the evidence anew),172 or to re-do, in full or in
part, the Final IRA Report.
(b)
197.
Panels should review the risk assessment rather than assess the risk
In Canada/US – Continued Suspension, the panel set out the basic task of panels under
Article 5.1 of the SPS Agreement, as follows:
An analysis under Article 5.1 consists of two fundamental questions. First,
was a risk assessment, appropriate to the circumstances and taking into account
168
International Plant Protection Convention, Article IV.
See: Panel Report, US – Continued Suspension, para. 7.443; Panel Report, Canada – Continued
Suspension, para. 7.432; Panel Report, EC – Hormones (Canada), para. 8.104; Panel Report, EC – Hormones (US),
para. 8.101; Panel Report, Japan – Apples (Article 21.5 – US), para. 8.137.
170
Panel Report, Japan – Apples (Article 21.5 – US), para. 8.137.
171
Panel Report, US – Continued Suspension, para. 7.443; Panel Report, Canada – Continued Suspension,
para. 7.432. (footnote omitted)
172
See: Panel Report, Japan – DRAMs (Korea), para. 7.43.
169
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risk assessment techniques developed by the relevant international
organizations conducted? Second, is the sanitary measure based on that risk
assessment? The Panel will address each question successively.173
198.
Under the first question, the panel properly acknowledged that its role was to assess
whether a valid risk assessment had been conducted. By contrast, it is not the role of a panel to
attempt to determine the actual level of risk.
199.
The SPS Agreement imposes a number of requirements for a risk assessment to be
considered valid under Article 5.1. The concept of “risk assessment” is defined in Annex A:4,
and a valid risk assessment must take into account the factors set out in Article 5.2 and Article
5.3. The risk assessment relied upon must also be appropriate to the circumstances, and take into
account risk assessment techniques developed by the relevant international organisations,
pursuant to Article 5.1.
These are the matters a panel must assess in relation to a risk
assessment.174 The role of the Panel in this dispute is thus to review the risk assessment
performed by the IRA Team, rather than to act as initial trier of the scientific evidence.175
Australia submits that the Panel’s role is not to ask: “is there a risk?”, but to ask: “was the risk
assessor’s decision objective and credible?”
(c)
The Panel may only intervene in the assessment of risk in limited
circumstances
200.
Australia considers that the Panel may not intervene in the assessment of risk relied upon
by Australia solely on the basis that it may have drawn different factual conclusions from those
of the IRA Team.176 In circumstances where the scientific evidence available on a particular
point may be susceptible to more than one interpretation by a “qualified and respected
source”177, a panel must not attempt “to settle a scientific debate” or to be an “arbiter of the
opinions expressed by the scientific community”178, even where its preferred view appears to be
173
Panel Report, US – Continued Suspension, para. 7.439; Panel Report, Canada – Continued Suspension,
para. 7.430.
See: Panel Report, US – Continued Suspension, para. 7.445; Panel Report, Canada – Continued
Suspension, para. 7.434.
175
Appellate Body Report, US – Countervailing Duty Investigation on DRAMS, para. 188. Also, see:
Appellate Body Report, US – Hot-Rolled Steel, para. 55.
176
See: Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada), para. 99; Appellate
Body Report, US – Lamb, para. 106.
177
Appellate Body Report, EC – Hormones, para. 194.
178
See: Panel Report, EC – Asbestos, para. 8.181.
174
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supported by the “‘preponderant’ weight of the evidence.”179 The Panel may not substitute its
judgment for that of the IRA Team.180 Australia submits that the question for the Panel is
whether the risk assessment relied upon by Australia is objective and credible, rather than
whether the outcomes of that assessment are “correct” (which suggests very little, if any,
deference). New Zealand fails to appreciate this and appears to think it can supply the Panel
with its own account of the scientific evidence and ask the Panel to choose the version it prefers,
whereas New Zealand’s actual burden is to demonstrate that the risk assessment relied upon by
Australia is not objective and credible.
201.
The obligation that a risk assessment be “as appropriate to the circumstances” (Article
5.1) supports Australia’s view that a panel should show considerable deference to the findings
reflected in a risk assessment. A risk assessor’s evaluation of risk must be tailored to the specific
circumstances of the particular case, which include the characteristics of the product, its origin
and destination, and other country-specific matters such as climate, geography and established
production processes.181 Australia submits that it would be inappropriate for a panel to attempt
to choose between such an assessment and an alternative account of the risk which is not
similarly embedded in the particular circumstances.
202.
Australia submits that the Panel should be guided by the approach taken by the
compliance panel in Australia – Salmon (Article 21.5 – Canada)182, which reasoned as follows:
[W]e find it difficult to read into the summary definition of risk assessment set
out in paragraph 4 of Annex A … specific requirements such that minor flaws
or misconceptions at a detailed level would preclude a study from falling
within the SPS definition of risk assessment. As agreed by all parties and
experts involved in this dispute, risk assessment, in particular a qualitative risk
assessment like the 1999 IRA [risk assessment], inevitably includes subjective
elements. On the other hand, we realize that there may be studies that are
flawed or biased to such extent that they cannot be said to meet any standard of
objectivity. We do not think that such studies should pass the test of a risk
assessment in accordance with the SPS Agreement.183
Appellate Body Report, EC – Asbestos, para. 178.
See: Appellate Body Report, US – Softwood Lumber VI (Article 21.5 – Canada), para. 99; Appellate
Body Report, US – Lamb, para. 106; Appellate Body Report, US – Cotton Yarn, para. 74.
181
Panel Report, Australia – Salmon, para. 8.71.
182
See: Panel Report, Australia – Salmon (Article 21.5 – Canada), paras. 7.44-7.58.
183
Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.47. (emphasis added; footnotes
omitted)
Although the panel made this statement in the context of its consideration of “the question of where to put
the threshold of an evaluation of likelihood consistent with the SPS Agreement”, Australia considers that the
179
180
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203.
Australia’s First Written Submission of Australia
18 July 2008
In that panel’s view, a risk assessment is required to meet a threshold level of objectivity.
It found support for its view from the objective factors required to be taken into account in a risk
assessment, the wording of Article 5.7, as well as the 1997 OIE International Aquatic Animal
Health Code on import risk analysis.184 The panel concluded that:
[T]he level of objectivity to be achieved in a risk assessment must be such that
one can have reasonable confidence in the evaluation made, in particular in the
levels of risk assigned.185
204.
The panel in Australia – Salmon (Article 21.5 – Canada) then examined the risk
assessment in question, and made the following findings:
Neither Canada nor the experts advising us, refers to scientific or other
information that was not taken into account in the 1999 IRA [risk assessment].
Moreover, whereas Canada and Dr. Wooldridge do point out certain
methodological flaws and alleged inconsistencies in the 1999 IRA that – if
absent – might have led to a lower level of assessed risk, we have not been
convinced that this would be so, at least not to such extent that we would no
longer have reasonable confidence in the levels of risk currently assigned in
the 1999 IRA. In summary, we believe that the flaws identified are not so
serious as to prevent us from having reasonable confidence in the evaluation
made and the levels of risk assigned.186
205.
The obligation under the SPS Agreement to obtain and rely upon a risk assessment
establishes that the (non-WTO) competent bodies that perform these risk assessments are given a
pre-eminent position in the decision-making process as to whether there is a legitimate basis for
particular SPS measures.
substance of the panel’s reasoning is equally relevant across a panel’s evaluation of each element of a risk
assessment.
184
This OIE Code states that “[t]he principal aim of import risk analysis is to provide importing countries
with an objective and defensible method of assessing the disease risks associated with the importation of aquatic
animals… Import risk analysis is preferable to a zero-risk approach because it provides a more objective decision”
(emphasis added). This, as well, supports the view that the evaluation of likelihood needs to achieve a certain level
of objectivity. See: Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.50.
185
Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.51. (emphasis added)
Australia notes that New Zealand itself appears to agree with the panel’s formulation of the appropriate test
for judging the WTO-validity of a risk assessment. Biosecurity New Zealand’s Risk Analysis Procedures states:
“While a risk assessment inevitably includes subjective elements there are a number of factors within the
SPS Agreement, including ‘risk assessment techniques developed by the relevant international organisations’,
‘available scientific evidence’, ‘scientific principles’ and ‘sufficient scientific evidence’, which should be used when
evaluating likelihood. The level of objectivity must be such that a reasonable confidence in the evaluation,
particularly in the nominated levels of risk, is achieved (WTO (2000)).” Exhibit AUS-7: Biosecurity New Zealand,
Risk Analysis Procedures, Version 1, (12 April 2006), Appendix 1, para. 1.3.1.8.
186
Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.57. (footnote omitted; original
emphasis; emphasis added)
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206.
Australia’s First Written Submission of Australia
18 July 2008
Australia submits that the Panel’s obligation to make an “objective assessment of the
facts”, pursuant to Article 11 of the DSU, requires it to ensure that it can have reasonable
confidence in the risk assessment relied upon by Australia. An intense scrutiny of the scientific
evidence by the Panel is not required in order for it to satisfy its obligation to conduct an
“objective assessment of the facts”, unless New Zealand has established that the Panel cannot
have reasonable confidence in the risk assessment. In order to do so, New Zealand must show
that the Final IRA Report (insofar as it relates to the risk assessments of the three pests in
question) is not objective and credible, that the IRA Team failed to take into account evidence
that would have led to a lower level of assessed risk had it done so, and that any flaws identified
are so serious as to prevent the Panel from having reasonable confidence in the evaluation
made.187 As the panel in Australia – Salmon (Article 21.5 – Canada) recognised, identification
of minor flaws or inconsistencies by New Zealand would not be sufficient to satisfy its
burden.188 The Panel cannot make New Zealand’s case for it. 189 If New Zealand fails to
demonstrate flaws so serious in the risk assessment, then there can be no reason for the Panel not
to have reasonable confidence in the Final IRA Report.
207.
Therefore, in Australia’s submission, application of the appropriate standard of review in
respect of the Panel’s assessment of the Final IRA Report means that the Panel may not
intervene in the findings or conclusions of the Final IRA Report unless New Zealand has
established that it is so seriously flawed that the Panel cannot have reasonable confidence in it.
Such a standard of review clearly does not require the Panel to show “total deference” to the
findings of the risk assessment, but at the same time it ensures that an appropriately deferential
standard is applied. For the reasons outlined in this submission, New Zealand has failed to meet
its burden.
(d)
The Panel should also show considerable deference under the third
requirement of Article 2.2
208.
Australia submits that, like the test in relation to the validity of a risk assessment under
Article 5.1, the Panel may only intervene in the IRA Team’s assessment of the scientific
evidence under the third requirement of Article 2.2 (that measures not be maintained without
See: Panel Report, Australia – Salmon (Article 21.5 – Canada), paras. 7.51 & 7.57.
Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.47.
189
Appellate Body Report, Japan – Agricultural Products II, para. 129.
187
188
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sufficient scientific evidence), if New Zealand has established serious flaws in the IRA Team’s
assessment of the evidence so that the Panel cannot have reasonable confidence in the evaluation
relied upon by Australia to adopt SPS measures. To do otherwise would effectively undermine
the deference required to be shown to a risk assessment under Article 5.1.
(e)
The Panel should also show considerable deference when evaluating whether
alternative SPS measures would achieve Australia’s ALOP
209.
The Panel must also be mindful of the standard of review if it is required to assess
whether particular SPS measures are more trade-restrictive than required under Article 5.6 of the
SPS Agreement, as this would necessitate an assessment of whether any suggested alternative
SPS measure(s) would achieve Australia’s ALOP.190 In Australia’s view, where the suitability
of a particular alternative measure has previously been evaluated as part of a risk assessment (in
accordance with Annex A(4) of the SPS Agreement), a panel may not conduct a de novo review
of whether that potential alternative measure would achieve a Member’s ALOP. Whether a
particular measure would achieve the ALOP involves scientific and technical judgment on the
basis of relevant evidence and the particular circumstances.
Where such judgment has
previously been exercised as part of the risk assessment process, a panel may not displace that
judgment where it reflects an objective and credible evaluation.
(f)
210.
The Panel’s right to consult experts cannot extend its role
In Australia’s view, the Panel’s role in reviewing a risk assessment is established by
Article 5.1 and cannot be extended by virtue of the Panel’s right to seek advice from experts on
scientific and technical issues.191 A panel may “seek information and advice from experts to
help it to understand and evaluate the evidence submitted and the arguments made” by the
parties192, but the role of experts is clearly distinct from that of the Panel, which is obliged to
make “an objective assessment of the facts”, pursuant to Article 11 of the DSU. Just as the Panel
is not entitled to conduct a de novo review of the scientific evidence itself or make scientific
findings, nor are the experts entitled to assume such a role.
Australia notes that a similar issue may also arise during a panel’s evaluation under the first requirement
of Article 2.2 of the SPS Agreement.
191
See: Article 13 of the DSU and Article 11.2 of the SPS Agreement.
192
Appellate Body Report, Japan – Agricultural Products II, para. 130. Also, see: Panel Report, US –
Continued Suspension, para. 7.420; Panel Report, Canada – Continued Suspension, para. 7.411.
190
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7.
Australia’s First Written Submission of Australia
18 July 2008
A panel should also show a degree of deference in assessing a Member’s decision to
adopt SPS measures based on a valid risk assessment
211.
In accordance with Article 5.1, SPS measures must be “based on” a valid risk assessment.
The Appellate Body has explained that “based on” means there must “be a rational relationship
between the measure and the risk assessment.”193 If the Panel finds that the Final IRA Report is
a valid risk assessment within the meaning of Article 5.1, then the burden is on New Zealand to
establish that there is no rational relationship between the measures adopted by Australia and the
recommendations of the Final IRA Report.
212.
Australia notes that there may be multiple legitimate interpretations of particular
evidence and conclusions as to risk. The Appellate Body has made it clear that a Member may
rely upon any “opinion coming from qualified and respected sources”.194 In circumstances
where a particular risk has been identified by a qualified and respected source, a Member may
choose to rely on that source, even where it represents a “divergent opinion”.195 Regulatory
discretion is therefore accorded to Members in relation to the expert opinion to be relied upon in
determining how to respond to a risk to human, animal or plant life or health. In Australia’s
view, WTO panels must respect that regulatory discretion.
213.
Australia considers that it is essential for the Panel to bear in mind that a particular
evaluation of risk may support a range of possible measures, and that it is up to the Member
concerned to select the most appropriate measure(s) to address the risk, taking into account the
relevant circumstances and its ALOP, as well as its obligation that any measures not be more
trade-restrictive than required. The panel in the EC – Biotech Products dispute recognised this:
[T]he mere fact that relevant scientific evidence is sufficient to perform a risk
assessment does not mean that the result and conclusion of the risk assessment
are free from uncertainties (e.g., uncertainties linked to certain assumptions
made in the course of the performance of a risk assessment). Indeed, we
consider that such uncertainties may be legitimately taken into account by a
Member when determining the SPS measure, if any, to be taken. In view of
these uncertainties, a given risk assessment may well support a range of
possible measures. Within this range, a Member is at liberty to choose the one
which provides the best protection of human health and/or the environment,
taking account of its appropriate level of protection, provided that the measure
Appellate Body Report, EC – Hormones, para. 193.
Appellate Body Report, EC – Hormones, para. 194.
195
Appellate Body Report, EC – Hormones, para. 194.
193
194
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chosen is reasonably supported by the risk assessment and not inconsistent
with other applicable provisions of the SPS Agreement, such as Article 5.6.196
214.
Accordingly, in Australia’s view, it is within the discretion of the importing Member to
choose which SPS measures it will adopt in order to address a particular risk, as long as those
measures are reasonably supported by a valid risk assessment.
196
Panel Report, EC – Biotech Products, para. 7.1525. (emphasis added)
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VI.
LEGAL AND FACTUAL REBUTTAL
A.
ARTICLE 2.2 AND ARTICLE 5.1 MUST “CONSTANTLY BE READ TOGETHER”
1.
New Zealand is wrong to treat Article 2.2 and Article 5.1 in virtual isolation
215.
There is a close relationship between the second and third requirements of Article 2.2 and
Article 5.1 of the SPS Agreement.197 The Appellate Body has on numerous occasions affirmed
that Article 2.2 and Article 5.1 should “constantly be read together” and that the elements of
each provision inform and impart meaning to the other.198
216.
New Zealand has, in substance, ignored this established guidance. Except for a few
cursory statements asserting that the provisions are related,199 it makes entirely separate
arguments in relation to Article 2.2 and Article 5.1 and fails to explicitly link the substance of its
claims. As a result, New Zealand fails to inform either Australia or the Panel how it considers
these provisions should operate and relate to each other.
217.
Australia’s key concern is that by treating Article 2.2 and Article 5.1 in virtual isolation,
New Zealand artificially divides the substantive matters of relevance under each. Article 2.2 is
not, as New Zealand implies, an obligation to assess a narrow category of scientific literature.200
Likewise, Article 5.1 is not primarily designed to discipline risk assessment methodology.201
Science and methodology, as well as relevant technical and economic factors, need to be
considered together to properly appreciate the determination of risk in the Final IRA Report.
218.
This is the vital point which New Zealand misses. The ascertainment of risk is a
multifaceted exercise. Risk is not determined exclusively by science. As appropriate to the
circumstances, it involves the weighing and balancing of a number of scientific, economic and
197
New Zealand only makes substantive arguments in relation to the third element of Article 2.2 which
requires that measures are “not maintained without sufficient scientific evidence”. No argumentation is advanced in
relation to the second element, that measures be “based on scientific principles”. New Zealand only makes passing
assertions of inconsistency with this element (see: New Zealand’s first written submission, paras. 4.6 & 4.405).
Accordingly, Australia’s response will likewise concentrate on the third element of Article 2.2.
198
Appellate Body, EC – Hormones, para. 180; Appellate Body, Australia – Salmon, para. 130; Appellate
Body, Japan – Agricultural Products II, para. 82.
199
New Zealand’s first written submission, paras. 4.152 & 4.405.
200
New Zealand’s first written submission, paras. 4.11-4.51.
201
New Zealand’s first written submission, paras. 4.159-4.206 & 4.403.
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technical factors”202, marshalling evidence according to a particular methodology, and finally,
the application of expert judgment at every stage of the process. None of these elements can be
meaningfully separated; they inform and impart meaning to each other.
Consequently,
Article 2.2 lacks context without Article 5.1 and Article 5.1 lacks the discipline of a specific
standard of science203 unless it absorbs the evidentiary requirements of Article 2.2.
219.
New Zealand’s isolated treatment of Article 2.2 and Article 5.1 fails to accord with the
proper interpretation of the provisions. Australia will therefore set out how the relationship
between these two provisions should be understood. It will demonstrate that the question of
whether Australia has maintained measures “without sufficient scientific evidence” under Article
2.2 can only be answered by considering whether Australia’s measures are based on a valid risk
assessment under Article 5.1.
220.
If the Panel applies Australia’s interpretation of the relevant provisions to the facts, rather
than New Zealand’s flawed analysis, it is clear that Australia’s measures are consistent with its
obligations under Article 5.1 and Article 2.2. Even if the Panel adopts New Zealand’s flawed
approach, New Zealand has still failed to make a prima facie case in support of its assertions.
2.
Consistency with Article 5.1 establishes consistency with Article 2.2
221.
The third requirement of Article 2.2 provides that “Members shall ensure that any
sanitary or phytosanitary measure … is not maintained without sufficient scientific evidence”.
This requirement is general in nature and provides, of itself, little guidance to Members as to
what will constitute a “sufficient” scientific basis for a measure.
222.
The Appellate Body has explained that “sufficiency” requires “the existence of a
sufficient or adequate relationship between two elements, in casu, between the SPS measure and
the scientific evidence.”204 “Sufficiency” is a “relational concept”205 and must be determined on
202
See: Article 5.1, Article 5.2 and Article 5.3 of the SPS Agreement.
Article 5.2 requires risk assessments to “take into account available scientific evidence”. However, as
Australia explains below, this is a purely procedural obligation that does not require a risk assessment to conform its
conclusions to the evidence. Accordingly, Article 5.1, of itself, lacks a specific standard against which to weigh
scientific evidence. According to Article 31(1) of the Vienna Convention on the Law of Treaties, Article 5.1 and
Article 5.2 should be interpreted in light of their context. Given that Article 2.2 is the most significant provision
supplying context for Article 5.1 and Article 5.2, in Australia’s view, it necessarily follows that the applicable the
standard for scientific evidence should be derived from Article 2.2.
204
Appellate Body Report, Japan – Agricultural Products II, para. 73.
205
Appellate Body Report, Japan – Agricultural Products II, para. 73.
203
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a “case-by-case” basis.206 In Australia’s view, this necessarily implies that the scope and content
of “sufficiency” is to be derived from other more specific and detailed provisions in the SPS
Agreement and the specific facts of each case. That is, its scope and content is context-driven.
223.
The Appellate Body has confirmed that “[t]he context of the word ‘sufficient’ or, more
generally, the phrase ‘maintained without sufficient scientific evidence’ in Article 2.2, includes
Article 5.1 as well as Articles 3.3 and 5.7 of the SPS Agreement.”207 Therefore each of these
provisions provides a relevant context for understanding what is meant by the term “sufficient”.
224.
Australia does not seek to justify its SPS measures under Article 5.7 or Article 3.
Australia has based its measures on a scientific risk assessment: the Final IRA Report. Since
Article 5.1 is the key discipline for Members seeking to base their SPS measures on risk
assessments, Australia submits that, in this dispute, “sufficiency” under Article 2.2 falls to be
determined within the context of Article 5.1.
225.
The relationship between Articles 2.2 and 5.1 is not merely one where two independent
provisions help to confirm the scope and content of one another.208 On the contrary, Article 2.2
and Article 5.1 exist in a very particular relationship whereby Article 5.1 is “viewed as a specific
application of the basic obligations contained in Article 2.2”.209 This means that Article 5.1 and
its associated provisions elaborate specific conditions which, if met, will positively establish
consistency with Article 2.2.
Close scrutiny of the provisions reveals that these specific
conditions are the ones which establish risk.
226.
Article 5.1 obliges Members to procure a risk assessment that is appropriate to the
circumstances:
Members shall ensure that their sanitary or phytosanitary measures are based
on an assessment, as appropriate to the circumstances, of the risks to human,
animal or plant life or health, taking into account risk assessment techniques
developed by the relevant international organizations. (emphasis added)
227.
The relevant definition of the term “risk assessment” is set out in Annex A, paragraph 4
of the SPS Agreement. It requires that a valid risk assessment must consider risk both in terms of
Appellate Body Report, Japan – Agricultural Products II, para. 73 & 84.
Appellate Body Report, Japan – Agricultural Products II, para. 74.
208
See: Appellate Body, EC – Hormones, para. 180; Appellate Body, Australia – Salmon, para. 130;
Appellate Body, Japan – Agricultural Products II, para. 82.
209
Appellate Body, EC – Hormones, para. 180; Panel Report, Australia – Salmon, para. 8.51.
206
207
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likelihood210 of entry, establishment and spread of a pest or disease, and the magnitude of the
economic and biological consequences.211 This definition of “risk assessment” accords with the
concept of risk found in ISPM No. 5. ISPM No. 5 defines “pest risk (for quarantine pests)” as:
The probability of introduction and spread of a pest and the magnitude of the
associated potential economic consequences.212
228.
“Risk”, accordingly, is not reducible to the probability of entry, establishment and spread,
nor is it wholly focussed on scientific evidence. “Risk”, by definition, must incorporate the
magnitude of associated economic and biological circumstances.213 Australia requests that the
Panel take this important point into account.
229.
Article 5.2 and Article 5.3 confirm that the determination of “risk” extends beyond the
consideration of scientific evidence. Article 5.2 sets out a list of technical factors that must be
taken into account in a risk assessment. Article 5.3 sets out a list of economic factors that must
be taken into account in a risk assessment. Neither of these provisions exhaust the categories of
evidence that may be considered in a risk assessment. In EC—Hormones, the Appellate Body
confirmed that the potential ambit of relevant considerations in a risk assessment is wide, and
extends to matters affecting risk in the “real world”:
It is essential to bear in mind that the risk that is to be evaluated in a risk
assessment under Article 5.1 is not only risk ascertainable in a science
laboratory operating under strictly controlled conditions, but also risk in
human societies as they actually exist, in other words, the actual potential for
adverse effects … in the real world where people live and work and die.214
230.
In Australia’s view, there is ample support in the SPS Agreement and the guidance of the
Appellate Body which confirms that the assessment of risk is complex and multifaceted. By
resting most of its arguments on a narrow category of scientific literature, New Zealand ignores
this fundamental point.
In Australia – Salmon, the Appellate Body recognised that the term “likelihood” in Annex A(4) has the
same meaning as “probability”: Appellate Body Report, Australia – Salmon, para. 123.
211
This definition finds support in: Panel Report, Australia—Salmon, para 8.72.
212
International Plant Protection Convention, International Standard for Phytosanitary Measures No. 5:
Glossary of Phytosanitary terms, 2007. (emphasis added)
213
This definition of “risk” is adopted in this submission and is used throughout with this meaning, except
in citing its use in past cases. Note that the Final IRA Report adopts the same notion of risk, defining it as the
“product of likelihood and consequences”. See: Final IRA Report, Part B, p. 4.
214
Appellate Body Report, EC—Hormones, para. 187.
210
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Australia – Apples (DS367)
231.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand compounds its error by appealing to the superficially attractive notion that
science is capable of disclosing a single, objective explanation of particular phenomena.
Australia submits that this is simply incorrect. Scientific evidence is permeated with varying
degrees of scientific uncertainty and, accordingly, never capable of monolithic interpretation.
232.
Australia is obliged to take into account ISPM No. 11 under Article 5.1. It notes:
Estimation of the probability of introduction of a pest and of its economic
consequences involves many uncertainties. In particular, this estimation is an
extrapolation from the situation where the pest occurs to the hypothetical
situation in the PRA area. It is important to document the areas of uncertainty
and the degree of uncertainty in the assessment, and to indicate where expert
judgment has been used. 215
233.
The specific challenge that scientific uncertainty presents in the context of risk
assessments is that scientific method is not, by definition, competent to resolve its own inherent
uncertainties. It cannot arbitrate between scientific evidence when confronted with a range of
credible or defensible scientific explanations of a particular phenomenon. Nor can scientific
method provide any definitive guidance to risk assessors in reaching conclusions about risk when
information is incomplete, unreliable or in some way compromised. This is especially the case
when, as in the Final IRA Report, risk assessors are seeking to assess risk in geographic areas
that are currently pest and disease free.216
Resolving or accommodating uncertainty can
therefore only be achieved through the exercise of expert judgment in accordance with the
specific requirements of each case.
Consequently, risk assessment inevitably entails the
application of expert judgment, as recognised in the extract from ISPM No. 11 above, past SPS
disputes217 and the SPS Agreement itself.218
215
Exhibit AUS-X: ISPM No. 11, para. 2.4 (emphasis added). International Plant Protection Convention,
International Standard for Phytosanitary Measures No. 2: Framework for pest risk analysis, 2007, para. 3.1
identifies some of the key sources of scientific uncertainty as follows: “Uncertainty is a component of risk and
therefore important to recognize and document when performing PRAs. Sources of uncertainty with a particular
PRA may include: missing, incomplete, inconsistent or conflicting data; natural variability of biological systems;
subjectiveness of analysis; and sampling randomness. Symptoms of uncertain causes and origin and asymptomatic
carriers of pests may pose particular challenges.”
216
Australia notes that New Zealand’s risk assessment for the importation of Litchi fruit (Risk analysis for
the importation of Litchi fruit (Litchi chinensis) from Australia, MAFNZ 2008 (p. 71) clearly recognises that
uncertainty can be an issue. For example, in relation to Ischnaspis longirostris the risk analysis states (emphasis
added): “There is no data on the tolerances or development thresholds in the literature making it hard to predict how
widely I. longirostris would establish in New Zealand … There is a high level of uncertainty around the efficacy of
the irradiation dose”.
217
Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.47; Panel Report, EC – Biotech
Products, para. 7.3053.
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234.
Australia’s First Written Submission of Australia
18 July 2008
Thus, Article 5.1 and its associated provisions are aimed directly at establishing, through
the structured application of expert judgment to scientific, technical and economic evidence, the
existence of a particular risk. Australia submits that Article 2.2 is also guided by similar aims.
The panel in Japan – Apples (Article 21.5 – US) recognised that:
[I]n …order for scientific evidence [under Article 2.2] to support a measure
sufficiently, it seems logical … that such scientific evidence must also be
sufficient to demonstrate the existence of the risk which the measure is
supposed to address”.219
235.
However, what Australia has clearly shown is that scientific evidence cannot
“demonstrate” risk, in the manner required by the SPS Agreement, on its own. It is only possible
to test whether the scientific evidence is sufficient to demonstrate a risk within the context of a
risk assessment where it is properly integrated with other relevant economic and technical
factors.
236.
Australia therefore submits that a valid risk assessment demonstrates “sufficient scientific
evidence” of a risk under Article 2.2, where a Member chooses to base its measures on a valid
risk assessment. Therefore, where there is a rational relationship between a measure and a valid
risk assessment, then that measure must also be found consistent with the requirement that it is
“not maintained without sufficient scientific evidence” under Article 2.2. Australia submits that
this is what the Appellate Body in Australia – Salmon meant when it affirmed that:
Articles 5.1 and 5.2 … ‘may be seen to be marking out and elaborating a
particular route leading to the same destination set out in’ Article 2.2.220
237.
Accordingly, if the Panel finds that Australia’s measures are consistent with Article 5.1,
Australia submits that the Panel should also find that the requirement for sufficient scientific
evidence under Article 2.2 is met.
The very term to “assess”, from which “assessment” derives, ordinarily means “evaluate or estimate the
nature, ability, or quality of”. In addition, the second requirement of a risk assessment under Annex A(4) provides a
clear obligation to “evaluate” (which is synonymous with “judge”) the probability of entry, establishment and spread
of a pest or disease as well as its associated economic and biological consequences. The SPS Agreement itself
therefore carries with it a clear textual direction that a risk assessor applies expert judgment in the assessment of
risk. (The Concise Oxford English Dictionary, Eleventh edition revised, 2006; The Oxford Paperback Thesaurus,
2006.)
219
Panel Report, Japan – Apples (Article 21.5 – US), para. 8.45 (emphasis added).
220
Appellate Body, Australia – Salmon, paras. 137-138.
218
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B.
NEW ZEALAND FAILS TO PROPERLY INTERPRET ARTICLE 5.1
238.
Australia recalls that:
Article 5.1 does not require that [a] risk assessment must necessarily embody
only the view of a majority of the relevant scientific community ...
[R]esponsible and representative governments may act in good faith on the
basis of … [scientific] opinion coming from qualified and respected sources.221
239.
In this case, Australia relies on the scientific account provided in the Final IRA Report as
the basis of its SPS measures. The Final IRA Report represents the culmination of a detailed
scientific analysis. It expresses the views of qualified and respected scientists applying their
expert judgment to deliver a robust assessment of the pests of concern.
240.
New Zealand disagrees with the conclusions in the Final IRA Report on fire blight,
European canker and ALCM. New Zealand argues that its alternative scientific account is the
only correct account and should prevail over that in the Final IRA Report. In so doing, New
Zealand seeks to characterise what is really scientific disagreement as a legal and factual error.
241.
However, the legal question to be answered by the Panel is not whether New Zealand’s
account is credible, or even whether it represents “mainstream” opinion. Australia is entitled to
rely on any objective and credible scientific account. Accordingly, the correct question must be
whether Australia’s measures are based on an objective and credible risk assessment.
242.
A valid risk assessment is one that meets the criteria set out in Article 5.1, Annex A(4),
Article 5.2 and Article 5.3. Since New Zealand has not made any claims in relation to Article
5.3 or the first requirement of Annex A(4), Australia takes this as a concession that these
requirements are met. Accordingly, Australia will establish that the Final IRA Report is a valid
risk assessment under the second and third requirements of Annex A(4), and Articles 5.1 and 5.2.
1.
New Zealand does not acknowledge that a risk assessment must be “appropriate to
the circumstances”
243.
There are two very significant deficiencies in New Zealand’s argument which infect the
whole of New Zealand’s case under Article 5.1. New Zealand fails to acknowledge that risk
assessments must be “appropriate to the circumstances” and in doing so, fails to properly
221
Appellate Body Report, EC—Hormones, para. 194.
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appreciate that they are contextual. In addition, it misrepresents the status of the Japan – Apples
findings and the guidance the Panel should draw from them.
(a)
Risk assessments are “appropriate to the circumstances” if they consider
factors which are relevant to the risk at hand
244.
The fact that the determination of risk is complex and multifacted attains particular
resonance in the requirement that a risk assessment must be “appropriate to the circumstances”
to satisfy Article 5.1.
245.
The Appellate Body in EC—Hormones confirmed that this requirement confers a certain
amount of discretion on Members:
Article 5.1 stipulates that SPS measures must be based on a risk assessment, as
appropriate to the circumstances, and this makes clear that the Members have
a certain degree of flexibility in meeting the requirements of Article 5.1.222
246.
The panel in Australia—Salmon recognised the potential breadth of this term:
Following Article 5.1, a risk assessment needs to be “appropriate to the
circumstances”. Answering a Panel question in this respect, Canada is of the
view that the circumstances thus referred to are the source of the risk (e.g., an
animal pathogen or a chemical contaminant) and the subject of the risk (i.e.,
whether it is to human, animal or plant life or health). For Australia, the phrase
“as appropriate to the circumstances” confers a right and obligation on WTO
Members to assess the risk, on a case by case basis, in terms of product, origin
and destination, including, in particular, country specific situations. We agree
that both interpretations may be covered by the term “as appropriate to the
circumstances.”223
247.
Country-specific situations, and the significance attached to those situations because of
their relevance to risk, are therefore particularly important to ensure the appropriateness of a risk
assessment. This was recognised by the panel in Japan—Apples:
It might be observed, in this context, that the requirement that the risk
assessment be “appropriate to the circumstances” has been considered to leave
some flexibility for an assessment of risk “on a case by case basis, in terms of
product, origin and destination, in particular country-specific situations”.
A relevant circumstance in this case is, in our view, the fact that Japan is
considered to be fire blight-free, as well as its specific climatic conditions,
222
223
Appellate Body Report, EC—Hormones, para. 129 (original emphasis; emphasis added).
Panel Report, Australia—Salmon, para. 8.71. (emphasis added).
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which make it a potentially favourable environment for the spread of fire
blight, should the disease enter the country.224
248.
It is worth noting that vulnerabilities to pest and disease incursion are specifically
identified in Japan – Apples as factors which may influence the assessment of risk.
Australia
has already provided in its factual background a detailed account of its quarantine situation.
Australia enjoys freedom from most of the world’s serious plant pests and diseases. The
economic success of Australia’s agricultural sector is dependent in part on its favourable pest
and disease status, as is the maintenance of the biological diversity of native plant and animal
life. Given these circumstances, the risks of pest and disease incursion in Australia are often
both serious and irreversible, and it is within this context that risk is evaluated.
249.
New Zealand omits any reference to the requirement that risk assessments must be
“appropriate to the circumstances” and therefore fails to appreciate that the IRA Team conducted
its work against this very specific factual and methodological background. By ignoring this,
New Zealand makes serious errors in arguing its case. New Zealand cannot discharge its burden
of proof by alternately offering its own view of a limited category of evidence, or deferring to
the findings in Japan – Apples. Neither constitutes a valid or appropriate risk assessment or is a
sufficient substitute for the proper discharge of New Zealand’s burden of proof.
(b)
250.
Japan – Apples was a legal, not scientific, process
New Zealand attempts to draw a direct analogy between the findings of Japan – Apples
and the present dispute. Since both disputes involve concerns that apples may transmit fire
blight, New Zealand argues that “this dispute is in substance no different” from the Japan –
Apples dispute,225 and the “conclusion[s] of the DSB … [are] directly applicable to the
circumstances of New Zealand apples”.226
251.
The panel in Japan – Apples found that the “risk that mature, symptomless apple fruit
would transmit fire blight was negligible”.227 New Zealand’s central contention is that this
Panel Report, Japan – Apples, paras. 8.238-8.240. (emphasis added).
New Zealand’s first written submission, para. 2.12.
226
New Zealand’s first written submission, para. 2.4.
227
New Zealand’s first written submission, paras. 4.9 & 4.170 quoting Panel Report, Japan – Apples, para.
8.153. New Zealand itself is not consistent on this point. In various parts of its submission, New Zealand glosses
over the finding that the likelihood of transmission of fire blight was “negligible” and instead says that “mature,
symptomless apple fruit is not a vector for fire blight” and that “fire blight would not be transmitted” (New
224
225
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finding is correct228, and that therefore, as the Final IRA Report “discounts this finding” and
“proceeds on the assumption that the Panel and the scientific experts were somehow wrong”, it is
inconsistent with both Article 2.2229 and Article 5.1.230
252.
Australia submits that New Zealand has completely misrepresented what Japan – Apples
stands for. Australia has never claimed that Japan – Apples is “wrong”, but only that the
conclusions are particular to that case. As such, it is inappropriate to transpose those findings to
the present dispute as if there were no differences between the countries, phytosanitary
circumstances, risk assessments and conditions of trade.
253.
Australia submits that there are three reasons why it is not appropriate to apply Japan –
Apples to the facts of this case. First, Japan – Apples is not a risk assessment. Secondly, the
conclusions of Japan – Apples are conclusions conditioned on the evidence in that dispute.
Thirdly, Japan – Apples and the present case are not sufficiently analogous for such findings to
have probative value.
i.
254.
Japan – Apples is not a risk assessment
A panel report, like those in Japan – Apples, does not meet any of the requirements of a
valid risk assessment under the SPS Agreement. It does not identify pests of phytosanitary
concern to the importing Member;231 it only addresses pests associated with the product of
concern to the particular exporting Member. Panellists do not evaluate risk;232 they merely test
the veracity of the evidence tendered by the parties. Nor do panels assess risk according to the
SPS measures that might be applied;233 they only examine those measures which are applied.
255.
Furthermore, the panel in the Japan – Apples dispute was only concerned with the
likelihood of transmission of fire blight and did not consider in depth the potential consequences
Zealand’s first written submission, para. 4.247, emphasis added.). The more precise formulation of the Panel’s
finding is that the likelihood (rather than the risk) that the transmission pathway was negligible (Panel Report, Japan
– Apples, para. 8.153) and accordingly this is formulation that Australia adopts.
228
New Zealand’s first written submission, para. 4.9.
229
New Zealand’s first written submission, paras. 4.9, 4.12, 4.15, 4.25, 4.26 & 4.31.
230
New Zealand’s first written submission, paras. 4.170, 4.171 & 4.237.
231
First requirement of a risk assessment: Appellate Body Report, Australia – Salmon, para. 121.
232
Second requirement of a risk assessment: Appellate Body Report, Australia – Salmon, para. 121.
233
Third requirement of a risk assessment: Appellate Body Report, Australia – Salmon, para. 121.
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of a fire blight incursion.234 Recalling that risk must address both the likelihood of entry,
establishment and spread, and the magnitude of associated economic and biological
consequences, Australia submits that the panel in that case did not consider risk as it should
properly be understood.
256.
Accordingly, Japan – Apples is not a risk assessment. If Australia had relied on the
findings in Japan – Apples uncritically, Australia could not have met its obligation under Article
5.1. Australia therefore submits that New Zealand commits a fundamental error in asking the
Panel to place the panel report on the same footing as the Final IRA Report.
ii.
257.
The findings in Japan – Apples are specific to that dispute
If the reports in Japan – Apples are not risk assessments, then neither do the findings in
those reports constitute scientific evidence. Australia submits that New Zealand treats the
panel’s conclusion regarding the likelihood of transmission as a conclusive scientific fact, when
it is really a conclusion about the evidence in that case. It is very clear from Japan – Apples that
Japan did not adduce sufficient scientific evidence to rebut the United States’ prima facie case
under Article 2.2.235 The panel repeatedly uses words that indicate that its findings are specific
to the evidence in that particular case. For example, the panel states:
On the basis of the information made available to the Panel, we conclude that
there is not sufficient scientific evidence that apple fruit are likely to serve as a
pathway for the entry, establishment and spread of fire blight within Japan.236
258.
This is not a surprising result when other material circumstances of that case are
considered. Japan, in that case, sought to justify the measures it imposed on US apples with its
1999 Pest Risk Assessment (1999 PRA). However, the panel found the 1999 PRA inconsistent
with Article 5.1 on the basis that it was insufficiently specific. The critical flaw was that the
1999 PRA did not assess risk according to apple fruit as a separate and distinct vector:
[The PRA] includes very general conclusions that “E. amylovora is risk Grade
A (extremely high)”. This conclusion, however, is based on an overall
Panel Report, Japan – Apples, para. 8.89. It is clear from this paragraph that the panel was only
concerned with the likelihood that the pathway could be completed up to the stage of possible transmission from an
infected or infested apple to a susceptible host.
235
Panel Report, Japan – Apples, paras. 8.147, 8.167 & particularly the last line of 8.175.
236
Panel Report, Japan – Apples, para. 8.176 (emphasis added).
Even the passage cited in New Zealand’s first written submission, para. 4.9 is conditional: “We conclude
from these elements that the scientific evidence presented to the Panel show that … the risk that the transmission
pathway be completed is negligible.” Panel Report, Japan – Apples, para. 8.153 (emphasis added).
234
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assessment of possible modes of contamination, where apple fruit is only one
of the possible hosts/vectors considered. As cited above, only one paragraph
in that chapter specifically addresses fresh fruit, simply noting that not all fruit
are distributed or consumed totally and "in the course of distribution,
processing and consumption, some can be released to the natural environment
as leftovers, waste or useless materials". Thus, although the risk assessment is
intended to be conducted, as indicated by its very title, in relation to the
importation of US fresh apple fruit, the main portion of the PRA is conducted
on the basis of a general assessment of possibilities of introduction of fire
blight into Japan, through a variety of hosts, including - but not exclusively apple fruit.
There is no clear indication in the document as [to] how the other possible
vectors might be of relevance to an assessment of the likelihood of entry,
establishment or spread through apple fruit specifically.
Indeed, the
conclusion of the PRA does not purport to relate exclusively to the
introduction of the disease through apple fruit, but rather more generally,
apparently, through any susceptible host/vector.237
259.
Thus, the conclusion that apples are unlikely to transmit fire blight must be viewed in its
proper context. Given that Japan’s 1999 PRA was not specific to apples, it was insufficient to
displace the categories of evidence considered by the Panel under Article 2.2. Likewise, the
absence of a structured assessment of the scientific evidence, together with the other technical
and economic factors to determine risk, meant that the scientific evidence tendered by the United
States under Article 2.2 could not be tested against or within any alternative assessments of risk.
Therefore, the findings in Japan – Apples is a specific conclusion about the sufficiency of
particular evidence under Article 2.2, in circumstances where Japan could not offer an
alternative view in its PRA because that PRA was not specific to apples. Accordingly Australia
submits that it is restricted to the circumstances of that case.
iii.
260.
Japan – Apples is not analogous to the present dispute
Even if the Panel considers that the findings of Japan – Apples have some factual value,
there are too many differences between the two disputes for any application of the findings to
have a coherent or meaningful result. There are significant differences between Australia and
Japan including environment, phytosanitary circumstances, hosts, fruit distribution systems,
consumption patterns and conditions of trade which all affect the assessment of risk.
261.
Moreover, the Final IRA Report for New Zealand apples is starkly different in content
and methodology from Japan’s 1999 PRA. The Final IRA Report reviews a significant body of
237
Panel Report, Japan—Apples, paras. 8.270-8.271. (emphasis added; footnotes omitted)
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literature, especially when compared to the limited number of scientific papers referred to in the
Japan – Apples dispute. Unlike the 1999 PRA, the risks associated with mature apples are
assessed in the Final IRA Report specifically and in detail, together with the associated economic
and biological consequences. Finally, the risks associated with apples are calculated within real
expected trade volumes from New Zealand.
iv.
262.
Summary
The findings of past disputes are not scientific evidence. Panellists are not scientific
experts. The process of weighing expert testimony is not a scientific experiment conducted in
accordance with scientific method. A panel’s findings are conclusions of evidence on the facts
and circumstances of each case. To the extent that experts give relevant evidence, such evidence
is inseparable from the specific circumstances of that case and therefore not “appropriate” to the
assessment of risk in Australia’s circumstances. Accordingly, New Zealand’s contention that
Japan – Apples disposes of the substance of this dispute is an abdication of its obligations
regarding burden of proof.
2.
New Zealand misinterprets the requirement to conduct an “evaluation” of
likelihood under Article 5.1
263.
New Zealand alleges that the Final IRA Report does not meet the requirements of Article
5.1 because it fails to “‘evaluate the likelihood’ of entry, establishment or spread of the pests of
concern to Australia” or evaluate the “likelihood of entry, establishment or spread ‘according to
the SPS measures which might be applied’”.238 According to New Zealand, this failure is fatal to
the Final IRA Report and therefore “a risk assessment within the meaning of the SPS Agreement
does not exist to support Australia’s measures”.239
264.
Australia submits that this allegation is without merit. New Zealand neither proves that
the IRA Team failed to assess “likelihood” as it should be correctly understood, nor proves that
any of the findings of the Final IRA Report genuinely lack credibility.
(a)
238
239
“Probability” and “possibility” are distinct concepts
New Zealand’s first written submission, para. 4.158.
New Zealand’s first written submission, para. 4.153.
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265.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand argues that the Final IRA Report fails to evaluate “likelihood” because it
“ascribes quantitative probability values to what are often no more than possibilities”240 and
therefore “treats as continuous, pathways that even under Australia’s own analysis are not shown
to exist”.241
Allegedly, the Final IRA Report “compounds this problem”242 through the
application of semi-quantitative methodology so as to magnify the assessment of risk.243
266.
To New Zealand, “possibility” is indistinguishable from a “negligible” event244 which it
also equates with “theoretical uncertainty”.245 By blurring what Australia will show are three
very different concepts, New Zealand obscures the way the genuine differences between them
affect the actual legal obligations that Australia must comply with.
267.
In EC – Hormones, the term “possibility” was considered to be synonymous with
“potential”.246 In Australia – Salmon, the Appellate Body clarified the distinction between
“likelihood” and “possibility” by noting that “‘likelihood’…has the same meaning as
‘probability’”,247 and means the “estimation of the likelihood…expressed either qualitatively or
quantitatively”.
By contrast, “potential” or “possibility” were “vague statements of mere
possibility of adverse effects occurring; statements which constitute neither a quantitative nor
qualitative assessment of probability”.248
268.
The difference between “probability” and “possibility” is therefore one of precision. The
obligation to evaluate “likelihood” requires a risk assessment to provide actual estimates of
probability – that is, to ascribe a quantum or value to an event. Contrary to New Zealand’s
assertions, it is clear that Australia has not assessed “possibility”. This is amply demonstrated by
the fact that every single step in the risk assessment is assigned a quantitative or qualitative
estimation of likelihood, even if that likelihood is very small.
New Zealand’s first written submission, para. 4.160.
New Zealand’s first written submission, para. 4.160.
242
New Zealand’s first written submission, para. 4.160.
243
New Zealand’s first written submission, paras. 4.173 & 4.403.
244
New Zealand’s first written submission, para. 4.236.
245
New Zealand’s first written submission, paras. 4.159 & 4.403.
246
Appellate Body Report, EC - Hormones, para. 184: “The ordinary meaning of ‘potential’ relates to
‘possibility’ and is different from the ordinary meaning of ‘probability’”.
247
Appellate Body Report, Australia - Salmon, para. 123.
248
Panel Report, Australia – Salmon, para 8.83 affirmed in Appellate Body Report, Australia – Salmon,
para. 129.
240
241
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New Zealand’s complaint concerning the use of “negligible” likelihoods is
misdirected
269.
When viewed against the proper definition of “possibility”, it becomes clear that New
Zealand’s claim that Australia has only assessed possibility is merely a convenient device to
colour the Final IRA Report’s use of “negligible” likelihoods with illegitimacy. New Zealand’s
real complaint, as is evident from the fact that it dedicates an entire section of its submission to
this argument,249 is that “negligible” probabilities should not be examined in a risk assessment.
It argues:
In assigning probability values to what are frequently the remotest of
possibilities (ie an event that almost certainly would not occur – one that is
negligible), Australia…provides no support for the suggestion that these steps
could occur.250…
[E]vents that have an extremely low likelihood…are nevertheless assigned
probability values which suggest they are likely to occur.251
270.
By suggesting that only “likely” probabilities should be assessed in a risk assessment,
New Zealand effectively contends that the SPS Agreement requires risk assessments to identify a
minimum magnitude of risk. Australia submits that such a claim is wholly without foundation.
Such a requirement has been expressly rejected by the Appellate Body as set out below.
271.
In EC – Hormones, the panel found that an estimate of risk within the statistical range of
0 to 1 in a million was not a “scientifically identified risk”.252 The Appellate Body did not accept
this reasoning, noting that:
To the extent that the Panel purported to require a risk assessment to establish
a minimum magnitude of risk, we must note that imposition of such a
quantitative requirement finds no basis in the SPS Agreement. A panel is
authorized only to determine whether a given SPS measure is ‘based on’ a risk
assessment.253
272.
If no risk is therefore too small to form the legitimate focus of a risk assessment, it also
follows that there should be no threshold of probability that each step in a pathway must exceed
in order to establish a risk. Applying this logic, New Zealand’s claim cannot be sustained. A
New Zealand’s first written submission, paras. 4.174-4.186.
New Zealand’s first written submission, para. 4.236. (emphasis added)
251
New Zealand’s first written submission, para. 4.241 (emphasis added).
252
Panel Report, EC—Hormones, para. 8.124 & footnote 331.
253
Appellate Body Report, EC—Hormones, para. 186; also, see: Appellate Body Report, Australia—
Salmon, para. 124.
249
250
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negligible event is a very small, but defined probability. Accordingly, the Final IRA Report
cannot be impugned for failing to assess “likelihood” simply because some steps in the pathway
are assessed as having a “negligible” likelihood.
(c)
New Zealand wrongly assumes that “negligible” events should be treated as
ruptures in the pathway
273.
New Zealand’s error in the use of “negligible” likelihoods also infects its claim that:
Australia analyses “importation steps” as if there were a continuous pathway
for the transmittal of the disease, ignoring the fact that at critical points there is
no evidence of a pathway and that the risk analysis should have reflected
this.254
274.
In other words, New Zealand argues that where the Final IRA Report assigns
“negligible” likelihoods to steps in the pathway, such events should be treated as breaking the
chain of causation for disease transmission, and accordingly, the assessment of risk should have
ceased. This is what New Zealand means by the claim that Australia treats certain pathways as
“continuous”.255
Australia disagrees.
This argument demonstrates that New Zealand’s
understanding of Annex A(4), and what is really meant by the term “risk”, is seriously flawed.
275.
Australia recalls that “risk” is defined both by the probability of entry, establishment and
spread of a pest or disease as well as the associated economic and biological consequences. For
a risk assessment to validly support measures, it must therefore proceed to an analysis of the
consequences.
Therefore, arguing that an analysis should always cease when events in a
pathway are “negligible” is not only introducing an illegitimate minimum threshold of
probability, but it is also improperly truncating the proper analysis of risk as required by Annex
A(4).
254
255
New Zealand’s first written submission, para. 1.9.
New Zealand’s first written submission, paras. 1.9 & 4.160.
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(d)
276.
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18 July 2008
New Zealand’s argument on “theoretical uncertainty” is baseless
The only kind of risk (or probability) that cannot be assessed under Article 5.1 is
theoretical risk.256 However, New Zealand’s understanding257 of theoretical risk is flawed.
277.
Theoretical uncertainty is not the same as “possibility”. It is defined as the “uncertainty
that theoretically always remains since science can never provide absolute certainty that a given
substance will not ever have adverse health effects”.258 However, apart from unsubstantiated
assertions, New Zealand does not demonstrate at any point that the probabilities assessed by the
Final IRA Report are theoretical.259 Therefore, a “negligible” likelihood cannot be assimilated to
theoretical uncertainty simply because it is small and, in any event, the Final IRA Report was
transparent about such likelihoods being small.
(e)
278.
Summary of New Zealand’s flawed arguments on Article 5.1
In Australia’s view, the arguments above demonstrate that New Zealand’s
characterisation of “likelihood” does not set out the proper legal standards to be applied. The
sparsity of any legal analysis by New Zealand on these critical issues in favour of superficially
attractive connections between actually distinct concepts merely disguises the weakness in New
Zealand’s case. New Zealand should not be permitted to benefit from its dispensing with
analytical rigour. Accordingly, Australia submits that the Panel should reject New Zealand’s
characterisation of “likelihood”.
3.
New Zealand cannot make a prima facie case by conducting its own risk assessment
279.
By keeping the legal standard vague, New Zealand creates a misleading impression that it
has made a prima facie case. Australia will demonstrate that it has not done so. New Zealand in
fact purports to conduct its own risk assessment and attempts to pass it off as a satisfactory
discharge of its burden of proof. Yet, at best, it only offers an alternative account of the
scientific evidence.
Appellate Body Report, EC – Hormones, para. 186.
See: New Zealand’s first written submission, paras. 4.159 & 4.403.
258
Appellate Body Report, Japan – Apples, para. 241 (original emphasis).
259
New Zealand’s first written submission, paras. 4.159 & 4.403. Australia notes that these paragraphs do
not contain any substantive argumentation and at no other point in New Zealand’s first written submission is
theoretical uncertainty mentioned.
256
257
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280.
Australia’s First Written Submission of Australia
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New Zealand’s characterisation of “likelihood” and particularly, whether “negligible”
likelihoods can legitimately be considered in an Article 5.1 risk assessment, only make sense
when New Zealand’s own risk assessment methodologies260 are examined. New Zealand’s Risk
Analysis Procedures define a “negligible” risk in the following table: 261
Table 3: Biosecurity New Zealand’s description for critical attributes of risk
Risk Attributes
Not worth considering; insignificant
Negligible
Worth considering; significant
Non-negligible
Risk Descriptors (not all may be used)
Close to insignificant
Very Low
Less than average, coming below
Low
the normal level
Around the normal or average level
Medium
Extending above the normal or
High
average level
Well above the normal or average
Very High
level
281.
Clearly, this is not equivalent to a “negligible” event in the methodology applied by the
Final IRA Report.
Even though it is described as an event that would “almost certainly not
occur”,262 a “negligible” likelihood in the Final IRA Report is a definite expression of a level of
probability and therefore an actual probability descriptor. By contrast, a “negligible” risk under
New Zealand’s methodology is a risk attribute which operates as a decision rule to judge
whether a risk is worth considering.
282.
This is confirmed by New Zealand’s Risk Analysis Framework:
[T]he risk analyst has the opportunity to stop the risk assessment at any point
[where] the risk from the hazard is deemed ‘negligible’, thus avoiding
unnecessary effort on insignificant risks…
Each pest, disease or pathway will be discussed only to the extent necessary to
enable the reader to gain an appreciation of likelihood of entry, establishment
or spread of hazard(s) and of their associated potential consequences. If, for
example, it is concluded that the likelihood of a hazard being released into
260
Exhibit AUS-7: Biosecurity New Zealand, Risk Analysis Procedures, Version 1, 12 April 2006;
Exhibit AUS-15: Biosecurity New Zealand, The Risk Analysis Framework: Delivering to Expectations, Version
1.3, 23 November 2005.
261
Exhibit AUS-7: Risk Analysis Procedures, p. 29.
262
Final IRA Report, Part B, p. 43.
103
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18 July 2008
New Zealand is negligible, there is no need to undertake an exposure and
consequence assessment and explore risk management options.263
283.
Viewed in this context, it becomes clear that by applying this method to its analysis of the
Final IRA Report, what New Zealand in fact does is conduct its own risk assessment according
to its own methodology. This is not contemplated by Article 5.1. It is the Member itself that
must conduct or procure a risk assessment as the basis of its measures.
284.
More importantly, conducting another risk assessment does not demonstrate
inconsistency with Article 5.1. All it does is establish that, at best, there is an alternative account
of the scientific evidence. The co-existence of divergent scientific views is well established and
accepted.264 Article 5.1 permits reliance on any view emanating from a qualified and respected
source.265 Accordingly, simply by showing that another account of the science may exist is
insufficient to discharge the burden of proving actual inconsistency.
285.
The purported errors in the Final IRA Report’s methodology which New Zealand
identifies are not in fact errors but points where the Final IRA Report’s methodology departs
from New Zealand’s risk analysis methodology. Accordingly, what New Zealand casts as
methodological error is in reality no more than methodological difference.
286.
The Appellate Body has affirmed, on a number of occasions, a Member’s right to
determine its own methodology. In Japan—Apples, the Appellate Body stated:
Japan contends that the “methodology” of the risk assessment is not directly
addressed by the SPS Agreement… We agree…[T]he Panel’s reading of EC –
Hormones does not suggest that there is an obligation to follow any particular
methodology for conducting a risk assessment.266
287.
Given this lies within the discretion of the Member, Australia breaches no obligation by
adopting a semi-quantitative approach that pursues the analysis of risk to its proper conclusion.
263
Exhibit AUS-15: Delivering to Expectations, p. 5. The Risk Analysis Procedures indicate that risk
analysts operating under New Zealand’s methodology have the opportunity to conclude an analysis at any of the
entry, exposure and establishment or consequence assessment stages if the likelihood ascribed to this step is
“negligible”. See: Exhibit AUS-7: Risk Analysis Procedures, pp. 43, 46 & 50.
264
Appellate Body Report, EC - Hormones, para. 194.
265
Appellate Body Report, EC - Hormones, para. 194; also see: Panel Report, US – Continued Suspension,
para. 7.444, footnote 550; Panel Report, Canada – Continued Suspension, para. 7.433, footnote 535.
266
Appellate Body Report, Japan—Apples, para. 204 (emphasis added).
104
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4.
New Zealand fails to identify flaws in the methodology used by the IRA Team
288.
New Zealand asserts that the semi-quantitative methodology used by the IRA Team is
flawed and, as such, it is “impossible to have any degree of confidence in the levels of risk
ascribed in the IRA”.267 New Zealand states that it has no objections “in principle” to the use of
the semi-quantitative methodology.268 Yet it seeks to impugn the use of the methodology by
referring to criticisms of it in the World Organisation for Animal Health (OIE) Handbook on
Import Risk Analysis for Animals and Animal Products269 (OIE Handbook) and asserting that the
methodology has three “fundamental flaws”.270 Australia submits that New Zealand should not
be permitted to expand its claims beyond these so-called “flaws” at a later time in these
proceedings. Australia will show that the methodology is not flawed and that, accordingly, the
Panel should disregard New Zealand’s claims.
289.
Australia has already dismissed the assertions made by New Zealand about the
“politicisation” of the risk assessment process. New Zealand makes these baseless assertions
throughout its submission. In relation to methodology, New Zealand claims that the semiquantitative methodology was adopted after a Senate Committee recommended that a full
quantitative method be adopted.271 Clearly, the Committee’s recommendation was not accepted.
i.
New Zealand’s reliance on the OIE Handbook is inappropriate in a dispute
concerning plants
290.
New Zealand refers to the OIE Handbook’s treatment of semi-quantitative methodology.
It cites the Handbook as stating that a “semi-quantitative approach”:
… is sometimes employed as a means of combining various qualitative
estimates, by assigning numbers to them, to produce a summary measure or to
prioritise risks.272
291.
However, the semi-quantitative methodology used by the IRA Team does not assign
numbers to qualitative estimates as suggested in this extract from the OIE Handbook. It does the
reverse. It uses a quantitative approach in its evaluation of the likelihood of entry, establishment
New Zealand’s first written submission, para. 4.160.
New Zealand’s first written submission, para. 4.162.
269
New Zealand’s first written submission, para. 4.163.
270
New Zealand’s first written submission, para. 4.172.
271
New Zealand’s first written submission, para. 4.161.
272
New Zealand’s first written submission, para. 4.164.
267
268
105
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and spread of pests as a result of trade in New Zealand apples. The likelihood is expressed
quantitatively and then equated to a qualitative descriptor to facilitate its use in the risk
estimation matrix.273
292.
Australia is surprised by New Zealand’s use of the OIE Handbook, as the OIE deals with
animals, not plants. Indeed, this point is recognised by Biosecurity New Zealand in its Risk
Analysis Procedures, as follows:
It is important to note that under these two standard setting bodies [OIE and
IPPC], application of the risk analysis frameworks are limited by the mandates
of the organisations.274
293.
With regard to the IPPC, Australia notes that the IPPC pest risk analysis training manual
acknowledges that:
No single method of pest risk assessment has proven applicable to all
situations; different methods may be appropriate in different circumstances.
Pest risk assessments can be carried out with qualitative data, quantitative data
or a combination of both.275
294.
The Manual describes a “semi-quantitative pest risk assessment” as one that:
… combines elements of both quantitative and qualitative assessments, adding
precision using quantitative methods where these are applicable, and
incorporating qualitative methods for those parts of the assessment where data
is not available or the same degree of precision is not required”.276
This describes the methodology used by the IRA Team, which combined a quantitative approach
to estimating the probability of entry, establishment and spread with a qualitative approach to
estimating consequences to give an estimate of risk.
ii.
295.
The IRA Team’s use of the probability interval of 0 – 10-6 is appropriate
New Zealand asserts that the first fundamental flaw in the methodology used by the IRA
Team is the choice of the maximum value of 10-6 in the probability interval for the likelihood of
an event being negligible.277 New Zealand seeks to establish that the choice of 10-6 as the
maximum value cannot be justified on the basis of known data.
273
See Table 2 in this submission.
Exhibit AUS-7: Risk Analysis Procedures, p. 8. (emphasis added)
275
Exhibit AUS-16: International Plant Protection Convention (2007) IPPC pest risk analysis course Participant manual, p. 36. (emphasis added)
276
Exhibit AUS-16: IPPC (2007) Training Manual, p. 37. This page also provided as Exhibit NZ-95.
277
New Zealand attempts to support this assertion in paras 4.174 – 4.186 of its first written submission.
274
106
Australia – Apples (DS367)
296.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand claims that setting the probability interval at 0 – 10-6 is “arbitrary”.278 It
relies on Biosecurity Australia’s 2001 Draft Guidelines for Import Risk Analysis279 in support of
this assertion, claiming that the Draft Guidelines “acknowledge that the probability intervals are
‘arbitrary’”.280 New Zealand selectively quotes from a section dealing with the advantages, not
disadvantages, of semi-quantitative methodology. The relevant text follows:
By specifying (albeit arbitrary) probability intervals it will generally be
possible to describe and interpret estimates of likelihood consistently. For
example, …analysts using the term ‘moderate’ will have indicated that they
have estimated a given likelihood to fall ‘somewhere between 0.3 and 0.7’.
All readers would understand that this was the analysts’ understanding of the
said likelihood, and that all other likelihoods described as ‘moderate’ should be
interpreted in the same way.281
297.
New Zealand quotes only the word “arbitrary” from this text. It declined to provide the
context for its use. The text explains that the probability intervals are used to assist consistency
in risk analysis. The Draft Guidelines note that problems of consistency may arise when a
qualitative approach is used where the likelihoods are “undefined”.282 This is so because:
[I]t will be impossible to state precisely what is meant by a designation of, for
example, ‘low’, because one person’s understanding of ‘the event would be
unlikely to occur’ …will be different to another’s.283
a.
New Zealand’s focus on the words, and not the numbers, is
misplaced
298.
New Zealand reproduces Table 12 of the Final IRA Report as Table 1 in its submission.
It draws the Panel’s attention to the likelihood “negligible” and its qualitative descriptor “the
event would almost certainly not occur”.284 However, New Zealand’s focus on the words, rather
than the numbers, is misplaced. As explained in the Final IRA Report:
The approach used in the 2004 draft was to assign descriptive terms to
quantitative ranges, (‘high’, ‘moderate’, ‘low’, etc). These terms were used
throughout the text to represent these quantitative ranges. However, this
caused some confusion with some stakeholders applying their own
interpretation to the terms rather than the meanings set out in the methodology.
New Zealand’s first written submission, para. 4.175.
Exhibit AUS-17: Biosecurity Australia (2001) Draft Guidelines for Import Risk Analysis.
280
New Zealand’s first written submission, para. 4.175.
281
Exhibit AUS-17: Biosecurity Australia (2001), Draft Guidelines, p. 89. (emphasis added)
282
Exhibit AUS-17: Biosecurity Australia (2001), Draft Guidelines, p. 83.
283
Exhibit AUS-17: Biosecurity Australia (2001), Draft Guidelines, p. 83.
284
New Zealand’s first written submission, para. 4.177.
278
279
107
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In order to overcome this problem, in the revised draft and this final IRA, the
descriptive terms are only used for qualitative values. Numbers are given for
quantitative values.285
In other words, the probability intervals were used in the Final IRA Report in estimating the
probability of entry, establishment and spread, not the qualitative likelihoods. Accordingly, the
focus must be on the numbers represented by the probability intervals in Table 12 of the Final
IRA Report – not the words.
b.
New Zealand fails to understand the use of the interval between 0
and 10-6
299.
When New Zealand does focus on the numbers, that focus becomes fixed on the use of
10-6 as the maximum value of the probability interval between 0 and 10-6.286 In doing so, New
Zealand demonstrates its failure to understand that it is the interval between 0 and 10-6, not any
one value in that interval, which was considered by the IRA Team. New Zealand underlines its
lack of understanding, when it states that:
… this figure [10-6] is applied on a per apple basis, rather than in respect of
trade as a whole as in Japan – Apples.287
300.
In a uniform distribution between 0 and 10-6, it is not the figure of 10-6 alone that is
applied. It is the values between 0 and 10-6 that are applied on the basis of the distribution. This
means that the probability of a particular event occurring is equally likely to be any probability
value within the interval bounded by the minimum and maximum values of the distribution. In
other words, the probability of an event happening is equally likely to be zero as one in a million
or any value in between.
301.
New Zealand refers to the IRA Team conducting its analysis on a “per apple basis” rather
than trade as a whole. In evaluating the probability of entry, establishment and spread of a pest,
the IRA Team had to determine the risk unit on which to base its analysis. The IRA Team
concluded that individual apple fruit carrying a pest could present a risk and that it was therefore
appropriate to use individual fruit as the risk unit. Accordingly, probabilities were estimated on
285
Final IRA Report, Part B, p. 42.
New Zealand’s first written submission, para. 4.178.
equivalent to one in a million.
287
New Zealand’s first written submission, para. 4.178.
286
108
New Zealand correctly states
that 10 -6 is
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18 July 2008
a “per apple” basis, which, in turn, were used as inputs in estimating the risk associated with the
total volume of trade.
302.
In the extract cited above from New Zealand’s submission, it again purports to represent
the findings in Japan – Apples as a risk assessment.288 Even if New Zealand were to rely on
those findings as the outcome of a legal process, Australia cannot locate any findings concerning
the use of probability intervals and uniform distributions.
303.
New Zealand then turns to the Final IRA Report and quotes from the section which
explains the use of probability distributions as follows:
In all cases the IRA team considered carefully whether they were confident
that the range they had chosen would contain the actual value…289
New Zealand goes on to assert that there is “no indication of the basis on which the IRA team
came to the conclusion they were ‘confident’” and, particularly, why it “considered that one in a
million was ‘negligible’ in the case of the importation of apples”. 290 New Zealand’s quote is
selective and needs to be considered in context, which is provided by the following more
extensive quote from the Final IRA Report:
Most pests were assessed using a semi-quantitative approach based on
information represented by numerical ranges. In all cases the IRA team
considered carefully whether they were confident that the range they had
chosen would contain the actual value and that the chosen distribution
reflected their beliefs. In particular, the IRA team was not constrained by the
intervals suggested in the draft Guidelines.291
304.
Clearly, this text is meant as a general statement of the approach taken by the IRA Team
in selecting probability intervals (“ranges”). Not surprisingly, the IRA Team took care to ensure
it was confident that a chosen interval would contain the actual value of an event occurring.
Where the IRA Team believed it had sufficient information to identify a most likely value in an
interval, it used a triangular distribution, represented by a minimum value, a maximum value and
a most likely value. Where the IRA Team considered it had insufficient information to identify
the most likely value in an interval, it adopted a uniform distribution, using a minimum value
and a maximum value.
New Zealand’s first written submission, para. 4.178.
New Zealand’s first written submission, para. 4.179. (emphasis added)
290
New Zealand’s first written submission, para. 4.180.
291
Final IRA Report, Part B, p. 42. (emphasis added)
288
289
109
Australia – Apples (DS367)
305.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand goes on to claim that:
Risk assessments should be based not on “feelings of confidence” but rather on
conclusions that are technically justified, which as the IPPC indicates means
justified on the basis of the examination and evaluation of available scientific
information.232
232. International Plant Protection Convention, Rome, 1999, Article II:1.292
New Zealand is seeking to suggest that the IRA Team members did not exercise their judgment
“on the basis of the examination and evaluation of available scientific information”.
The
comprehensive review of the scientific literature documented in the Final IRA Report
demonstrates that New Zealand’s suggestion is wrong.
306.
New Zealand makes use of the expression “technically justified” which is defined in
Article II.1 of the IPPC as meaning:
justified on the basis of conclusions reached by using an appropriate pest risk
analysis or, where applicable, another comparable examination and evaluation
of available scientific information.293
Australia submits that the IRA Team did arrive at “technically justified” conclusions on the basis
of an “appropriate pest risk analysis” as demonstrated in the Final IRA Report.
307.
New Zealand asserts that the IRA Team could have checked whether the “maximum
value of 1 x 10-6 had any relationship to what occurs in the real world”.294 Again, New Zealand
fails to appreciate that 10-6 is the maximum value in a probability interval applied as a uniform
distribution. The probability of an event happening as represented by that interval is equally
likely to be zero or one in a million or any value in between.
c.
308.
New Zealand’s flawed approach to the use of trade data
New Zealand contends that the IRA Team could have looked at trade data and concluded
by doing so that a maximum probability value of 1 x 10-6 is too high given “known data”.295
New Zealand’s first written submission, para. 4.181. (emphasis added)
IPPC (New Revised Text). (emphasis added)
294
New Zealand’s first written submission, para. 4.182.
295
New Zealand’s first written submission, para. 4.182.
292
293
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New Zealand goes on to provide the example of the trade in apples engaged in by itself and the
United States with Chinese Taipei.296 New Zealand contends that:
[d]espite the absence of any special measures to protect against fire blight, no
case has occurred of fire blight being introduced into Chinese Taipei from this
trade.297
309.
Australia submits there are a number of basic flaws in New Zealand’s argument on this
point. To begin with, the IRA Team was concerned with New Zealand exporting its apples to
Australia and not to Chinese Taipei. The IRA Team had to assess the potential volume of trade
that would occur between New Zealand and Australia, and not the existing trade between New
Zealand and Chinese Taipei. Further, the IRA Team was not conducting a risk assessment on
the importation of apples from the United States into Australia. As such, the trade in apples from
the United States to Chinese Taipei is even more irrelevant than the trade in apples between New
Zealand and Chinese Taipei.
310.
New Zealand states that the result of its “risk assessment” is that the chance of fire blight
being introduced into Chinese Taipei through the trade in apples is at most between three in a
billion and four in ten billion.298 However, without transparency as to the “known data” used as
an input, the outcome cannot be verified. For example, it is unclear whether the “known data”
addressed factors within Chinese Taipei such as the occurrence of fire blight host plants,
environmental factors, distribution systems, consumption patterns, disposal routes and location
of packing houses.
311.
Australia notes that New Zealand claims that Chinese Taipei does not apply any “special
measures” for fire blight. However, Australia’s research has shown that, in fact, Chinese Taipei
does have a requirement in relation to E. amylovora. The Chinese Taipei authorities require that
phytosanitary certificates issued by the New Zealand authorities, which accompany shipments,
must include a declaration that “Apples are thoroughly inspected and found free from Erwinia
amylovora.”299
New Zealand’s first written submission, para. 4.183.
New Zealand’s first written submission, para. 4.183. (emphasis added)
298
New Zealand’s first written submission, para. 4.184.
299
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register: Taiwan, p. 28 (available at http://www.biosecurity.govt.nz/files/regs/stds/icprs/taiwan.pdf; last accessed 11
July 2008).
296
297
111
Australia – Apples (DS367)
iii.
312.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team’s use of uniform distributions did not inflate risk
New Zealand asserts that the second fundamental flaw in the semi-quantitative
methodology used by the IRA Team was the “use of the uniform distribution to model events,
particularly those that have a ‘negligible’ likelihood of occurring”. 300 New Zealand alleges that
the use of the uniform distribution at “key points” inflated the likelihood of entry, establishment
and spread of the three pests at issue.301 Australia submits that this assertion demonstrates New
Zealand’s lack of understanding about the IRA Team’s use of the uniform distribution.
313.
Australia agrees that in a uniform distribution “every value between the maximum and
minimum value is equally likely to occur”.302 Indeed, Australia has made this point more than
once above in response to New Zealand’s assertions regarding the maximum value of the
probability interval between 0 and 10-6.
314.
New Zealand argues that the mean of a uniform distribution is a value halfway between
the maximum and minimum values of the distribution.303 This is an obvious point. New
Zealand goes on to note that the midpoint for the probability interval 0 – 10-6 is 5 x 10-7, which is
5 in 10 million or one in two million. New Zealand claims that 5 x 10-7 represents “one adverse
event in every two million samples” and that:
… under Australia’s approach, an event that “would almost certainly not
occur” will in fact be expected to occur on average approximately once in
every two million samples.304
315.
Once again, New Zealand misunderstands the IRA Team’s use of the probability interval
0 – 10-6 as a uniform distribution. The midpoint of 5 x 10-7 is no more significant than any other
value in the uniform distribution of 0 – 10-6.
As stated by New Zealand, in a uniform
distribution “every value between the maximum and minimum value is equally likely to
occur”.305
316.
New Zealand again focuses on the “average” of a uniform distribution when it claims
that:
New Zealand’s first written submission, para. 4.187.
New Zealand’s first written submission, para. 4.187.
302
New Zealand’s first written submission, para. 4.189.
303
New Zealand’s first written submission, para. 4.190.
304
New Zealand’s first written submission, para. 4.191. (emphasis added)
305
New Zealand’s first written submission, para. 4.189.
300
301
112
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18 July 2008
… by using a uniform distribution which effectively averages the higher and
lower ends of the probability range, the IRA gave undue weight to the
maximum probability of a “negligible” event occurring.306
Australia finds it difficult to the follow the logic of New Zealand’s claim. In Australia’s view, it
would only have merit if each step in the model was estimated separately and the average value
taken forward as the input into the next step. However, this is not the logic used in the model by
the IRA Team. At each step of the model, the full distribution of output values is effectively
taken forward to the next step – not just the average value as New Zealand has apparently
assumed. This is done by the process that “chooses” a value from each step based on the input
distribution for each step in each run of the simulation. In the interests of transparency during
the IRA process, in early 2006 Australia supplied New Zealand with a copy of the model used by
the IRA Team.
317.
Australia has demonstrated that New Zealand’s claim that the IRA Team’s use of the
uniform distribution is a fundamental flaw in the semi-quantitative methodology is without
merit.
318.
Further, Australia notes that, as the SPS Agreement does not prescribe methodologies for
use in risk assessments, it also does not prescribe the types of probability distributions to be used
or not used in risk assessments. Accordingly, New Zealand’s efforts to impugn the IRA Team’s
use of uniform distributions have no basis in the SPS Agreement.
iv.
New Zealand’s assertions on volume of trade are based on faulty
suppositions
319.
New Zealand asserts that the third flaw in the IRA Team’s semi-quantitative
methodology is that it overestimates the likely volume of trade in apples from New Zealand,
thereby magnifying the assessment of risk. Australia submits that this assertion lacks substance
and should be disregarded by the Panel.
320.
New Zealand presents a simplistic description of how volume of trade was incorporated
into the IRA Team’s analysis. New Zealand states that:
… the assigned “probability” per apple of a pest being imported is...multiplied
by Australia’s estimate of the annual volume of trade in New Zealand apples,
306
New Zealand’s first written submission, para. 4.192. (emphasis added)
113
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18 July 2008
to give the number of infested or infected apples imported. From this value,
the overall assessed level of risk is calculated. The higher the estimated
volume of trade, the higher the overall assessed risk.307
In asserting that the probability per apple of a pest being imported is multiplied by the annual
estimate of trade, New Zealand has misunderstood the process followed. In fact, the volume of
trade expressed as a Pert distribution is used in the same way as all the other distributions in each
of the many thousands of iterations used to generate the overall result.
321.
New Zealand asserts that the estimate of the likely volume of trade made by the IRA
Team is “out of all proportion with the trade” that would occur.308 New Zealand correctly states
that the IRA Team represented volume of trade as a range between 50 million apples and 400
million apples per year, with a most likely value of 150 million apples. However, New Zealand
claims that the most likely value of 150 million apples “bears no relationship to the reality of
likely Australian demand for New Zealand apples or New Zealand’s capacity to supply that
demand”.309
322.
Before addressing the lack of economic and commercial substance in this claim,
Australia will provide further detail on the Pert distribution used by the IRA Team to represent
volume of trade. A Pert distribution contains a most likely value, a minimum value and a
maximum value, which are joined by a curve. As the most likely value of 150 million apples is
closer to the minimum value of 50 million apples than the maximum value of 400 million apples,
the shape of the curve gives greater weight to values toward the lower end of the scale.
323.
The IRA Team adopted this approach in response to submissions from New Zealand on
the level of trade it expected to occur. The Final IRA Report advises that the final distribution:
… gives significantly more emphasis to the lower end of the volume range but
does allow for volumes higher than that suggested by New Zealand at the
higher end.310
324.
The Final IRA Report acknowledges the difficulty of estimating the volume of trade in
the absence of existing trade.311 However, the most likely value of 150 million apples in a 12
New Zealand’s first written submission, para. 4.195. (footnote omitted; original emphasis)
New Zealand’s first written submission, para. 4.196.
309
New Zealand’s first written submission, para. 4.196.
310
Final IRA Report, Part B, p. 19.
311
Final IRA Report, Part B, p. 18.
307
308
114
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month period was not plucked out of the air by the IRA Team as New Zealand implies in its
submission. The IRA Team took into account a range of economic and commercial factors in
making its judgment on the values for volume of trade.312
a.
325.
New Zealand’s four faulty suppositions
New Zealand’s assertion that the IRA Team overestimated the most likely value for
volume of trade is based on the following faulty suppositions:

Australian consumers will not buy the main types of apples produced in New
Zealand;

Australian supermarkets will only sell Australian grown apples;

the most likely level of imports used by the IRA Team would drive down prices in
Australia to such an extent that New Zealand’s exports to Australia would become
uneconomic; and

New Zealand exporters will want to continue to service existing customers rather
than diverting exports to Australia.
b.
New Zealand wrongly supposes that Australian consumers will not
buy the main varieties of apples it produces
326.
New Zealand suggests that the “main opportunity” for its exporters would be to supply
“limited volumes of high quality varieties of apples that are unfamiliar to Australian
consumers”.313 Implicit in this suggestion is a supposition that Australian consumers will not
accept imports of New Zealand’s two main varieties, Royal Gala and Braeburn. New Zealand
provides a comparison of the composition of Australian and New Zealand production in Table 2
of its submission, showing that only Royal Gala makes up a significant proportion of production
in both countries.314 New Zealand asserts that the composition of Australian production defines
Australian consumers’ “preferred” varieties. New Zealand provides no evidence that Australian
consumers would not accept New Zealand Royal Gala. The variety is one with which Australian
consumers are familiar and which New Zealand infers is “preferred” by those consumers.
Rather, New Zealand concentrates on arguing that Australian consumers will not accept
312
Final IRA Report, Part B, pp 18-19.
New Zealand’s first written submission, para. 4.199.
314
Table 2, New Zealand’s first written submission, para. 4.198.
313
115
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Braeburn, apparently on the basis that the limited volume of Australian production of Braeburn
is a demonstration that it is not “preferred” by those consumers.
327.
The New Zealand presumption that consumer preferences in any country can be inferred
from the composition of that country’s production has no basis in fact. The varietal composition
of production in each of the United States, United Kingdom, Germany, Netherlands and France
is completely different to that in New Zealand. Yet each of these countries is a significant export
market for New Zealand. Royal Gala makes up more than 10% of production in the United
States, 13% in the United Kingdom and 5% in Germany.315 Braeburn accounts for 9% and 5%
of production in France and Germany, respectively. Otherwise New Zealand's main varieties
account for little or none of the production in the above five countries. It is not evident that the
relatively low production of either one or both of Royal Gala or Braeburn in each of the five
countries has inhibited imports of New Zealand fruit. Similarly, there is no reason to believe that
the current composition of Australian production provides a template for what New Zealand fruit
Australian consumers would choose to import.
328.
New Zealand claims that collaboration between the apple industries in both countries “is
expected to make available the same new apple varieties to both countries” thereby removing
“any niche market advantage” enjoyed by New Zealand growers.316 Whatever the future may
hold for collaboration between the respective industries, it is instructive to note the recently
expressed views of the Chief Executive of Pipfruit New Zealand, Mr Peter Beaven, about the
state of the Australian apple market. Mr Beaven believes that Australian consumers are “denied
choice” and pay “the second highest apple prices in the world…for second rate produce”.317
329.
Clearly, Mr Beaven believes that Australian consumers will welcome the choice
presented by access to apples from New Zealand. If the “high quality varieties”318 to be exported
to Australia by New Zealand are competing against “second rate produce”, they could be
US Apple Organisation 2005, “Total US Apple Production by Variety,”
http://www.usapple.org/industry/applestats/outlook2005/Table8.xls; Eurofel, EU-27 Apple Production,
http://www.vic.lt/events/prognosfruit2007/docs/Prognosfruit2007_Eurofel.pdf.
316
New Zealand’s first written submission, para. 4.199.
317
Exhibit AUS-20: Pipfruit New Zealand, "Pipfruit Industry in Support of NZ Submission to WTO",
Media Statement of Mr Peter Beavan, 21 June 2008.
318
New Zealand’s first written submission, para. 4.199.
315
116
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
expected to secure more than a niche market. If Mr Beaven’s assessment of price is correct,
there is a significant marketing opportunity in Australia for New Zealand apples.
330.
On the issue of market prospects for apples from New Zealand, Australia also points to
the 2006 report on development strategy prepared by the Innomarc Consulting Project Team for
Pipfruit New Zealand.319
The report identifies Australia as a “significant opportunity for
exports” from New Zealand.320
c.
New Zealand wrongly supposes that Australian supermarkets will
be unlikely to stock New Zealand apples
331.
New Zealand claims that there is “open support” by Australian supermarkets for
Australian-grown produce,321 implying that its growers would confront hurdles in getting their
apples before Australian consumers. On this issue, New Zealand selectively quotes from a
submission made by Apple & Pear Australia Ltd (APAL)322 to an Australian Government
inquiry into grocery prices.323 It is correct that APAL stated that major supermarkets “openly
support” Australian produce, except when it cannot be sourced in Australia. However, APAL
added that:
[I]t is believed that in closed door negotiations with local sellers they
[supermarkets] use international commodity prices to push down the price of
locally sourced product...324
332.
In Australia’s view, the commercial position of the major supermarkets is more likely to
be reflected by the following statement by Coles Myer Ltd (one of two major supermarket chains
operating in Australia) to the Australian Government Agriculture and Food Policy Reference
Group:
Coles’ policy is to always purchase Australian products where quality, quantity
and competitive price allow.325
319
Exhibit AUS-21: Innomarc Consulting Project Team (2006) Smarter, Faster, Better – Leading Niche
Player: a Development Strategy for the New Zealand Pipfruit Industry.
320
Exhibit AUS-21: Innomarc (2006) Smarter, Faster, Better – Leading Niche Player, pp. 22-23.
321
New Zealand’s first written submission, para. 4.197.
322
Exhibit NZ-51: Apple & Pear Australia Ltd, Public Submission to ACCC Grocery Inquiry, 11 March
2008.
323
Australian Competition and Consumer Commission inquiry into grocery prices.
http://www.accc.gov.au/content/index.phtml/itemId/809228
324
Exhibit NZ-51: APAL Submission, p. 8 (response to question 53).
117
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18 July 2008
In other words, a preference for Australian products is one of several key considerations in
deciding on the source of any product. New Zealand apples would have to compete on quality,
quantity and price, just as they would have to do in any other market.
333.
Recalling the views expressed by the Chief Executive of Pipfruit New Zealand about the
high price and second rate quality of Australian apples, New Zealand is asking the Panel to
accept that Australian supermarkets would continue to sell “second rate” and “higher priced”
Australian apples in preference to “higher quality” and “lower priced” New Zealand apples.
d.
New Zealand wrongly supposes that its apples entering the
Australian market will lead to large price falls
334.
New Zealand’s next supposition is that, if Australian supermarkets were to stock apples
from New Zealand, any attempt by New Zealand to sell 150 million apples into the market
would lead to a large fall in prices (20% or more) which would make New Zealand exports to
Australia uneconomic.326 New Zealand seeks support for this view from a report prepared by the
Australian Bureau of Agricultural and Resource Economics (ABARE). 327 This report was taken
into account by the IRA Team.328
335.
New Zealand’s reliance on the ABARE report is based on a misunderstanding of the
nature of the research and its findings. The ABARE report estimates the levels of Australian
production and consumption of apples and imports of New Zealand apples under the assumption
that opening the Australian market to New Zealand apples would cause a given price fall.
Estimates are provided for the volume of imports consistent with price falls of 5%, 10% or 20%.
In fact, rather than suggesting that Australian apple prices are very sensitive to changes in
supply, the ABARE report argues that, because Australian producers always have the option of
exporting, imports could not drive down the Australian price by very much.
336.
Recent data on Australian domestic wholesale apple prices compared to New Zealand
apple export prices raises further questions as to New Zealand’s supposition. As shown in
Figure 1 below, between 2000-01 and 2006-07, New Zealand export prices have been well
325
Exhibit AUS-22: Coles Myer Ltd (2005) Submission to the Agriculture and Food Policy Reference
Group, Department of Agriculture, Fisheries and Forestry, p. 3.
326
New Zealand’s first written submission, para. 4.200.
327
Exhibit NZ-52.
328
Final IRA Report, Part B, pp. 18-19.
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Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
below Australian domestic wholesale apple prices, and in the years 2003-04 and 2006-07, when
Australian production was significantly reduced due to drought conditions, the divergence
between prices become even more significant.329
Figure 1: Australia and New Zealand apple prices
Australia and New Zealand apple prices
3000
Australia1
2500
A$/tonne
2000
1500
1000
NZ Exports2
500
0
2000-01
2001-02
e.
2002-03
2003-04
2004-05
2005-06
2006-07
New Zealand wrongly supposes its exporters will not divert their
apples to Australia
337.
A further supposition by New Zealand is that its exporters have tied up their future
exports in long term contracts to Northern Hemisphere customers to such a point that they would
not export significant quantities of apples to Australia. This view, however, does not appear to
accord with available evidence and expected future market developments.
338.
The USDA Foreign Agricultural Service observed in 2005 that “[a] large number of
exporters diverted product to the European market in 2005, following forecasts at the beginning
329
Sources and definitions: (1) Average of values for Sydney, Melbourne and Brisbane markets. For
Sydney and Melbourne, average of monthly values, average for all apples, TLcarton. For Brisbane, average for all
apples TLcarton. Data compiled by Ausmarket Consultants, including data collected by Sydney and Melbourne
Market Price Reporting Services, 14 April 2008. (2) Year ending March 31. Derived from carton prices, New
Zealand MAF 2007 and earlier issues.
119
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Australia’s First Written Submission of Australia
18 July 2008
of the season that prices would be poor in the U.S. market”.330 Contrary to New Zealand’s
supposition, this suggests that New Zealand’s exporters would switch to the Australian market if
prices were favourable.
339.
Rabobank331 has also reported that New Zealand apple producers have faced increasing
competitive pressures in the world market in recent years. The Innomarc Consulting Project
Team rated Chile as being a “major direct competitor” to New Zealand.332
According to
Rabobank, Chile has a strongly export-oriented industry and is a strong competitor for New
Zealand in counter-seasonal trade.333 The New Zealand Ministry of Agriculture and Forestry has
reported that it expects world apple production to increase over the next few years, mainly as a
result of expansion in China and South American countries.334 Australia submits that increased
competition can be expected to have an impact on New Zealand’s position in its existing
markets, resulting in New Zealand apple producers looking for new export opportunities.
340.
Finally, Australia considers that new storage technology is another market factor which
will put pressure on New Zealand’s exports to its existing Northern Hemisphere customers. The
commercialisation of treatment of fruit with 1-methylcyclopropene, marketed as SmartFresh™,
allows producers to hold fruit at premium quality for longer periods than was previously
possible. Rabobank argues that, as a result of this new technology, the window of opportunity
for New Zealand to profit from Northern Hemisphere markets from its counter-seasonal
production has “almost closed”.335
341.
In sum, Australia has demonstrated the lack of economic and commercial substance to
the suppositions underpinning New Zealand’s assertion that the IRA Team overestimated the
volume of trade that would occur.
Accordingly, Australia submits that the Panel should
disregard this assertion.
330 Exhibit AUS-23: United States Department of Agriculture Foreign Agricultural Service, "New
Zealand Fresh Deciduous Fruit Annual 2006", GAIN Report Number: NZ6001, 22 December 2005, p. 6.
331 Exhibit AUS-24: Rabobank (2006), "New Zealand Apple Industry – crunch time!", Rabobank Global
Focus, January 2006, p. 7.
332 Exhibit AUS-21: Innomarc (2006), Smarter, Faster, Better – Leading Niche Player, p. 30.
333 Exhibit AUS-24: Rabobank (2006) "New Zealand Apple Industry – crunch time!" Rabobank Global
Focus, January 2006, p. 5.
334 Exhibit AUS-25: Ministry of Agriculture and Forestry New Zealand (2007), Situation and outlook for
New Zealand agriculture and forestry (apples and pears).
335
Exhibit AUS-24: Rabobank (2006) "New Zealand Apple Industry – crunch time!" Rabobank Global
Focus, January 2006, p. 5.
120
Australia – Apples (DS367)
v.
342.
Australia’s First Written Submission of Australia
18 July 2008
Summary
Australia has demonstrated that the SPS Agreement is not prescriptive as to methodology.
Accordingly, Australia is entitled to rely on the semi-quantitative methodology applied by the
IRA Team. It is not required to use New Zealand’s methodology. Far from being flawed, as
claimed by New Zealand, the semi-quantitative methodology used by the IRA Team was sound
and applied rigorously. Therefore, what New Zealand casts as methodological error is no more
than methodological difference. It is evident that New Zealand’s criticisms are based on a
misunderstanding of the IRA Team’s methodology and the requirements of the SPS Agreement.
343.
Australia has also shown that New Zealand’s arguments regarding volume of trade are
flawed and lacking in economic and commercial substance.
121
Australia – Apples (DS367)
C.
Australia’s First Written Submission of Australia
18 July 2008
AUSTRALIA’S MEASURES ARE CONSISTENT WITH ARTICLE 5.1, AND
ACCORDINGLY, WITH ARTICLE 2.2
344.
There is substantial overlap in New Zealand’s technical and scientific arguments under
Article 2.2 and Article 5.1, therefore Australia will address them together. However, since the
question of sufficient scientific evidence under Article 2.2 can only be answered by a valid risk
assessment in this dispute, Australia will deal with all these issues according to the scenarios
analysed in the Final IRA Report.
1.
The Panel should be guided by the approach in Australia – Salmon (Article 21.5)
345.
New Zealand does not adequately define the legal standard that a risk assessment has to
meet in the hope that its unbalanced assessment of the evidence, which ignores the importance of
expert judgment and context, can substitute for a proper discharge of its burden of proof. It is
impossible to properly assess whether Australia has met its legal obligations under Article 5.1
unless those legal obligations are clearly spelled out.
346.
The appropriate legal standard is closely related to the Panel’s standard of review.
Australia recalls that in Australia – Salmon (Article 21.5 – Canada), the panel established that an
“evaluation” will meet the requirements of Annex A(4) and Article 5.1 if it “achieve[s] a certain
level of objectivity”.336
A risk assessment will be consistent with this requirement if the
complainant fails to establish that the panel should not “have reasonable confidence in the
evaluation made, in particular in the levels of risk assigned.”337 It will not be enough for a
complainant to show that flaws or inconsistencies in the evaluation of likelihood338 may have led
to a lower level of assessed risk. New Zealand must convince the Panel that the flaws are “so
serious”339 that their absence would have led to a lower level of assessed risk.340
347.
Australia submits that the reasoning in Australia – Salmon (Article 21.5 – Canada) is
persuasive and provides instructive guidance to the Panel. New Zealand cannot claim that the
IRA Team’s evaluation of risk is “seriously flawed” on the sole basis that it does not reflect New
Panel Report, Australia – Salmon (Article 21.5 - Canada), para. 7.48.
Panel Report, Australia—Salmon (Article 21.5 - Canada), para. 7.51.
338
Panel Report, Australia—Salmon (Article 21.5 - Canada), para. 7.47.
339
Panel Report, Australia—Salmon (Article 21.5 - Canada), para. 7.57.
340
Panel Report, Australia—Salmon (Article 21.5 - Canada), para. 7.57.
336
337
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18 July 2008
Zealand’s alternative account of the evidence. Demonstrating the existence of divergent view is
not sufficient to actually “prevent” a Panel from having reasonable confidence in the evaluation
made.
2.
The IRA Team made an objective and credible evaluation of the likelihood of entry,
establishment and spread of the pests, as well as the associated potential biological and
economic consequences
348.
Australia submits that New Zealand fails to establish a prima facie case that the risk
assessments for fire blight, European canker or ALCM are inconsistent with Article 5.1 and
consequently, Article 2.2. At best, New Zealand shows that if the selective evidence it tenders is
assessed in the same way New Zealand assesses it, the IRA Team may have assigned lower
likelihoods at certain steps in the pathway. The test elaborated by the panel in Australia—
Salmon (Article 21.5 – Canada) contemplates a much more serious departure from objectivity
before a Member will be found in breach of the second requirement of Annex A(4).
Accordingly, Australia will show that the Final IRA Report’s risk assessments on fire blight,
European canker and apple leaf-curling midge are objective and credible and should not be
disturbed.
3.
Fire blight
349.
New Zealand claims that the IRA Team’s fire blight risk assessment is inconsistent with
Article 5.1 because it fails to assess the likelihood of entry, establishment and spread of the
disease and its associated economic and biological consequences. Its central complaint is the
same in respect of the importation scenario (entry), establishment and spread scenario and
consequence assessment: that the probability values assigned at each step of the risk assessment
are “arbitrary”, “inflated” and have “no justification in science”.341
350.
Australia denies this claim and submits that New Zealand has failed to identify any flaws
in the risk assessment for fire blight, let alone any flaws serious enough to prevent the Panel
from having “reasonable confidence” in the risk assessment. New Zealand bases its case on four
faulty assertions:
341
New Zealand’s first written submission, paras. 4.207 & 4.254.
123
Australia – Apples (DS367)
351.
Australia’s First Written Submission of Australia
18 July 2008

That Japan – Apples decides this case;

That the spread of fire blight to other countries via trade in apple fruit has never
been demonstrated;

That the populations of E. amylovora are insufficient at every stage of the
pathway to initiate infection of fire blight;

That the Roberts and Sawyer (2008)342 study provides a “correct” assessment of
the risk fire blight introduction through apple fruit.
As these four assertions are used repeatedly by New Zealand throughout its submission
on fire blight, Australia will address them first.
(a)
New Zealand makes four key errors
i.
352.
The findings in Japan – Apples are not scientific evidence
Australia has already demonstrated why it would be wholly inappropriate to apply the
findings in Japan – Apples to this case as if it were an alternative risk assessment or its findings
amounted to scientific evidence. Australia reaffirms those arguments and will address the
specific instances where New Zealand has relied on this case as they arise.
ii.
No mode of fire blight transmission has ever been categorically
established
353.
New Zealand makes two objections to the assessment of apples as a risk pathway. First,
it claims that “[t]he spread of fire blight has never been linked to trade in apple fruit” 343 and
places great weight on this so-called fact throughout their submission. New Zealand points to
the “long history of trade” between exporting countries and fire blight free countries as purported
proof that “there has been no case of the introduction, establishment and spread of [fire blight]
via apple fruit”.344 In its view, this is borne out by its own experience of having “exported
billions of apple fruit without any phytosanitary measures”345 as well as the experience of the
United States “as noted by the Panel in Japan – Apples”346.
Exhibit NZ-29: Roberts, RG and AJ Sawyer (2008) “An updated pest risk assessment for spread of
Erwinia amylovora and fire blight via commercial apple fruit” Crop Protection 27, 362-368.
343
New Zealand’s first written submission, para. 3.52. (Article 2.2)
344
New Zealand’s first written submission, para. 4.27. (Article 2.2)
345
New Zealand’s first written submission, para. 4.28. (Article 2.2)
346
New Zealand’s first written submission, para. 4.29. (Article 2.2)
342
124
Australia – Apples (DS367)
354.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand mostly relies on anecdotal evidence to support its claims, and for good
reason: there is no direct evidence which establishes that apples do not spread fire blight.347
Even Jock et al. (2002)348, which is referred to by New Zealand, simply speculates about the
causes of fire blight spread and does not make definitive findings. What New Zealand holds out
as “fact” is actually no more than belief based on inferences drawn from anecdotal evidence.
355.
The Final IRA Report notes that the spread of fire blight from countries carrying the
disease to other countries has been attributed variously to movement of contaminated planting
material, wind, rain, birds, insects and fruit boxes.349 However, there is no direct evidence on
any of these modes of introduction of fire blight. A close examination of the scientific evidence
supports this view. For example, Taylor et al. (2003), a source relied on frequently by New
Zealand, openly notes that it is merely a hypothesis that fire blight was introduced into New
Zealand via infected rootstock:
It is believed that fire blight was introduced into New Zealand on either
nursery or propagation material.350
356.
Another example of an unexplained incursion was the fire blight outbreak in the Royal
Botanic Gardens in Melbourne, Australia. Given the location of the nearest fire blight disease is
in New Zealand, wind, rain, insects and birds were considered extremely unlikely to be the mode
of spread. The records of the Botanic Gardens clearly show that there was no introduction of
planting material of fire blight hosts that could have introduced the disease.351 Accordingly, it is
thought that the most likely mode of introduction was mechanical via visitors, fruit or some other
object. This case illustrates that the “beliefs” about spread of fire blight from country to country
do not adequately explain each case and provides support for the modes of spread identified in
the Final IRA Report.
357.
Given that there is no direct evidence confirming any of the long distance modes of
spread for fire blight, the IRA Team considered that there was no reason why apple fruit could
New Zealand’s first written submission, para. 4.30. (Article 2.2)
Exhibit NZ-30: Jock, S, V Donat, MM Lopez, C Bazzi, and K Geider (2002) “Following spread of fire
blight in Western, Central and Southern Europe by molecular differentiation of Erwinia amylovora strains with
PFGE analysis” Environmental Microbiology 4(2), pp. 106-114.
349
Final IRA Report, Part B, p. 94.
350
Exhibit NZ-28: Taylor, RK, CN Hale, FA Gunson and JW Marshall (2003a) “Survival of the fire blight
pathogen, Erwinia amylovora, in calyxes of apple fruit discarded in an orchard” Crop Protection 22, 603-608, p.
603. (emphasis added)
351
Exhibit AUS-3: Final IRA Report, Part C, p. 107.
347
348
125
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18 July 2008
not equally be considered a pathway for the introduction of fire blight. While New Zealand may
assert that such a pathway is no more than a theoretical possibility, 352 there is internationally
recognised research which indicates that risks may arise from apple fruit.
358.
For example, Billing and Berrie (2002)353 considered the events that might have been
involved in the introduction of fire blight and subsequent spread. In particular, they focussed on
the long standing belief that fire blight may have established in England via fruit boxes
contaminated by fruit carrying E. amylovora. They note:
During a visit to the USA in 1960, J.E. Crosse (unpublished report) learnt that
1954 was a severe blight year and that post-harvest rotting of pears in storage
was a problem. About that time, one or more Kent growers used boxes in
which fruit had been imported from the USA (Lelliot, 1959). The possibility
that contaminated wooden fruit boxes could pose a risk was further indicated
when an outbreak of fire blight in England occurred in 1960 in a pear orchard
145km north of the nearest case. The disease started at a point where fruit
boxes from a Kent orchard were stacked (Lelliott, 1967). If rotting pears were
imported in 1955, some could have reached rubbish dumps in the south
London suburbs ant [sic] the Thames Estuary area. Inoculum might then have
been spread by insects or birds to host trees or shrubs nearby.354
359.
These comments describe a scenario involving mechanical transmission similar to one
considered by the IRA Team.
360.
Many countries do regard trade in fruit as a risk, as they have some measures for
importation of apple fruit intended to reduce the risk of transmission of fire blight. For example,
South Africa requires United States fruit to be sourced from an area where E. amylovora is not
known to occur.355 Argentina and Chile both require that New Zealand apples are treated by
immersion for one minute in 100 ppm of chlorine.356 These measures are very similar to the
substantive risk reduction measures proposed by Australia for fire blight.
352
New Zealand’s first written submission, para. 4.403. Australia notes that New Zealand have made no
arguments substantiating this claim.
353
Exhibit AUS-26: Billing, E. and Berrie, A.M. (2002) “A re-examination of fire blight epidemiology in
England” Acta Horticulturae 590, pp. 61-67.
354
Exhibit AUS-26: Billing and Berrie (2002), p. 62.
355
Exhibit AUS-27: US Northwest Horticultural Council Export Manual, South Africa, Section E:
http://www.nwhort.org/nhcpublic/southafrica.html. Accessed 15 July 2008.
356
Exhibit AUS-18: Biosecurity New Zealand Importing Countries Phytosanitary Requirements Argentina, 21 March 2007, Section 4.1, p. 12: http://www.biosecurity.govt.nz/files/regs/stds/icprs/argentina.pdf.
Accessed 13 July 2008; Biosecurity New Zealand ICPR - Chile, 22 March 2007, Section 4.1, p. 19
(http://www.biosecurity.govt.nz/files/regs/stds/icprs/chile.pdf; accessed 13 July 2008).
126
Australia – Apples (DS367)
iii.
361.
Australia’s First Written Submission of Australia
18 July 2008
The number of E. amylovora sufficient to initiate infection is not agreed
New Zealand’s second claim in relation to the pathway is that mature apple fruit do not
contain sufficient, viable populations of E. amylovora to initiate infection of fire blight357 and
therefore, apple fruit is not a vector for the transmission of fire blight. In its view, the IRA
Team’s failure to take this point into account at every stage of the pathway, and in particular the
importation scenario, shows that it “ignored or significantly misunderstood scientific evidence,
which throughout provides no support for the suggestion that these steps could occur”. 358 On
this basis, New Zealand considers the assessment of entry to be flawed.
362.
Australia agrees that the number of E. amylovora required to initiate an infection is an
important issue.
However, Australia strongly disagrees that the scientific evidence
unequivocally demonstrates that there is a minimum threshold number.359
Australia will
demonstrate, at the appropriate point in the pathway (transmission),360 that there is in fact no
consensus on this point.
Contrary to New Zealand’s assertion that 104 E. amylovora are
required,361 there is evidence to suggest that even one bacterium can initiate an infection.362
Accordingly, since it is well established that apples can carry E. amylovora, a fact acknowledged
by New Zealand itself363, it was open to the IRA Team to conclude that this pathway could
validly be assessed.
New Zealand’s first written submission, paras. 4.219, 4.224, 4.227 & 4.229.
New Zealand’s first written submission, para. 4.236.
359
Exhibit AUS-28: van der Zwet, T., Biggs, A.R., Heflebower, R. and Lightner, G.W. (1994) “Evaluation
of the MARYBLYT computer model for predicting blossom blight on apple in West Virginia and Maryland”, Plant
Disease 78(3), pp. 225-230; Exhibit AUS-29: Hildebrand, E.M. (1937) “Infectivity of the fire-blight organism”,
Phytopathology 27, pp. 850-852.
360
Epidemiologically significant populations of E. amylovora become relevant at the transmission stage of
the pathway.
361
New Zealand’s first written submission, para. 4.244.
362
Exhibit AUS-29: Hildebrand (1937), p. 851.
363
New Zealand’s first written submission, para. 4.226.
357
358
127
Australia – Apples (DS367)
iv.
363.
Australia’s First Written Submission of Australia
18 July 2008
Roberts and Sawyer (2008) is not appropriate to Australia’s circumstances
New Zealand places considerable reliance on the paper by Roberts and Sawyer (2008)364
as providing a sound scientific analysis of “the phytosanitary risk associated with the movement
of export-quality apple fruit to countries where fire blight does not occur”.365 Although in the
title of the paper it purports to be a “risk assessment”, it does not meet the definition of a risk
assessment under Annex A(4) of the SPS Agreement or the IPPC definition of a risk
assessment366 as it fails to consider the consequences of entry, establishment and spread. As
such, it should not be regarded as equivalent in any way to the Final IRA Report.
364.
Australia does not consider Roberts and Sawyer (2008) to be relevant to the
circumstances of this dispute.
Australia considers the findings to be both unreliable and
inappropriate and will elaborate below why the Panel should disregard the study.
a.
Roberts and Sawyer (2008) is based on scenarios which bear no
plausible relationship to the assessment of the unrestricted risks
365.
Roberts et al. (1998), a previous study conducted by the same author, contains essential
detail needed to understand Roberts and Sawyer (2008). Examination of these papers shows that
the findings in Roberts and Sawyer (2008) are largely based on the circumstances relevant to
trade in apples from the United States into Japan prior to the Japan – Apples dispute.367
Critically, this means that the apples sampled for the experiments relied on by Roberts and
Sawyer (2008) were drawn from orchards that were considered to conform to various
phytosanitary measures for fire blight disease. The phytosanitary conditions required were:
buffer zones, three inspections of orchards, chlorine disinfection of bins, chlorine disinfection of
apples, inspection of containers and inspection on arrival; or only one inspection, trees should
have less than 1% fire blight strikes and apples would not be exported from infected or adjacent
trees.368 Apart from the obvious fact that New Zealand is not the United States, these conditions
364
Exhibit NZ-29: Roberts and Sawyer (2008).
New Zealand’s first written submission, para. 4.26.
366
International Plant Protection Convention, International Standard for Phytosanitary Measures No. 5
Glossary of Phytosanitary Terms, 2007 defines “pest risk assessment (for quarantine pests)” as follows: “Evaluation
of the probability of the introduction and spread of a pest and the magnitude of the associated potential economic
consequences.” (original emphasis)
367
Exhibit NZ-22: Roberts et al. (1998), p. 24.
368
Exhibit NZ-22: Roberts et al. (1998), p. 24.
365
128
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18 July 2008
bear no plausible relationship to the assessment of the unrestricted risks of fire blight that are
associated with the importation of apples from any area of New Zealand without any risk
management measures.
366.
New Zealand makes no attempt to show why this assessment is directly relevant to trade
in apples from New Zealand to Australia. The lack of relevance to the circumstances of
Australian trade, is demonstrated by Table 1 in Roberts and Sawyer (2008).369 Information
relevant to the presence (or absence) of fire blight on mature apples is listed, drawing on six sets
of data from orchards in the United States, New Zealand and Canada. Five of these data sets
were generated in North America while only one of them was generated in New Zealand.
Neither Roberts and Sawyer (2008), nor New Zealand, provide any justification for the
assumption that conditions in North America with respect to fire blight are the same as New
Zealand.
367.
Roberts and Sawyer (2008) construct three risk scenarios (S1, S2 and S3).
In
constructing each scenario, they draw upon orchards with different fire blight status. The
scenario most relevant to the Final IRA Report is S3. Roberts and Sawyer (2008) state that S3 is
constructed from orchards where no phytosanitary requirements for E. amylovora are
implemented.370 However, 95% of the orchards included in S3 were considered to operate under
some degree of risk management for fire blight. For example, orchards making up 94% of the
S3 category required one pre-harvest field survey, required that there should be no more than 1%
of trees with fire blight strikes and that apples from infected or adjacent trees could not be
exported. Presumably, S3 was based on assumptions made about the proportion of different
orchards that exports would be drawn from in the United States. While this may have been a
valid assumption for exports from the United States under the old export protocols for Japan, it is
inappropriate to apply these same old assumptions to the potential trade from New Zealand.
368.
New Zealand calculates, based on Roberts and Sawyer (2008) and taking into account the
IRA Team’s most likely volume of trade of 150 million apples, that “an outbreak of fire blight in
Australia caused by a New Zealand apple would be expected to occur once in 29,057 years”.371
However, New Zealand’s calculation is based on the false assumption that significant risk
369
Exhibit NZ-29, Roberts and Sawyer (2008), p. 364.
Exhibit NZ-22, Roberts et al. (1998), p. 25.
371
New Zealand’s first written submission, para. 4.251.
370
129
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18 July 2008
management measures would be in place in 95% of New Zealand orchards. This is a curious
assumption considering that New Zealand argues throughout its submission that no risk
management measures are needed.
A more appropriate and realistic assumption for New
Zealand when considering the IRA Team’s assessment of unrestricted risk (no risk management
measures required) for fire blight would be to assume that no orchards would have any risk
management in place. If the authors’ probability value for the number of apples carrying E.
amylovora of 0.0200382 for this scenario and the other values are accepted, and the volume
adjusted to reflect trade of 150 million apple fruit, the estimated likelihood becomes one event in
2,004 years, not 29,057 years as estimated by New Zealand.
New Zealand has therefore
overestimated the number of years to outbreak by more than ten times.372 Accordingly, New
Zealand’s claim that Roberts and Sawyer (2008) can be relied upon to “provide statistical
support to show that the risk of importing E. amylovora on commercial apple fruit … is so small
as to be ‘insignificant’”373 cannot be sustained.
b.
369.
Roberts and Sawyer (2008) relies on flawed experimental data
Roberts and Sawyer (2008) also relies upon data drawn from experiments which failed to
detect E. amylovora on apples. In calculating the probability that fruit is contaminated with
E. amylovora, the study assumed that a failure to detect E. amylovora meant that there are zero
E. amylovora on fruit.
It ignores the fact that many of the studies on the presence of
E. amylovora were not capable of detecting low bacterial numbers. However, even ignoring this
significant problem, the authors’ values for the probability that fruit is contaminated with
E. amylovora (0.0200382) are higher than the lower values used in the Final IRA Report. In
other words, Roberts and Sawyer concluded that, at least under some circumstances, the
probability of contamination of apples with E. amylovora fell within the range used in the Final
IRA Report. These issues are addressed in further detail in the discussion on Importation step 2,
below.
370.
Despite the flaws identified above, Roberts and Sawyer (2008) does also provide support
for the conclusions in the Final IRA Report about the probability that E. amylovora transfers to a
372
373
New Zealand’s first written submission, para. 4.251.
New Zealand’s first written submission, para. 4.251.
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18 July 2008
new host and initiates infection. In the Final IRA Report, this step is referred to as exposure.374
The corresponding value in Roberts and Sawyer (2008) is determined by combining P4
(probability that host is at receptive stage) and P5 (probability of E. amylovora transfer to new
host and infection occurs). Combining P4 (0.05) and P5 (0.0003786) results in a value of
0.00001893 (1.893 x 10-5).
371.
It is clear that the maximum value used in the Final IRA Report (10-6) is less than one
tenth of the value used by Roberts and Sawyer (2008) suggesting that if anything, the Final IRA
Report underestimates the probability of the transfer and infection step occurring. Similar
conclusions can be drawn about the IRA team’s probability estimate in Importation step 2.
These two examples clearly show that even if Roberts and Sawyer (2008) is applied, it tends to
support rather than detract from the conclusions reached by the IRA Team. New Zealand’s
attempt to portray the probability estimates in the Final IRA Report as unrealistically large and
inconsistent with the scientific literature therefore fails.
c.
Roberts and Sawyer (2008) does not justify its use of confidence
limits
372.
In estimating the input values, Roberts and Sawyer (2008) have sometimes chosen to use
the upper confidence limit of 50%. In simple terms, this means that the actual probability value
has a 50% chance of being greater that the estimated value. The confidence level chosen needs
to be appropriate to the circumstance and there is no definitive international standard in this
regard. However, it should be noted that the OIE manual relied upon by New Zealand in its
submission uses the 95%375 level in most examples, while ISPM No. 31376 provides tables for
confidence limits only from 80% to 99%.
373.
There is no justification provided in Roberts and Sawyer (2008) for the use of the 50%
confidence limit. One explanation could be that they are attempting to model an “average”
374
Final IRA Report, Part B, pp. 85-90. These pages of the Final IRA Report discuss the factors relevant to
this step in detail.
375
OIE Handbook on Import Risk Analysis for Animals and Animal Products (Volume 2: Quantitative Risk
Assessment), World Organisation for Animal Health, Paris (2004).
376
Exhibit AUS-30: International Plant Protection Convention, International Standard for Phytosanitary
Measures No. 31: Methodologies for sampling of consignments, 2008, from Report of the Third Session of the
Commission on Phytosanitary Measures, Rome, 7-11 April 2008, pp. 14-15.
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18 July 2008
situation. However, by giving less emphasis to less frequent events, the study downplays the
potential risks.
374.
The choice of confidence limit has a profound impact on the estimated years to first
outbreak. The 50% confidence limit applied to obtain Roberts and Sawyer’s P5 value of
0.0003786 leads to New Zealand’s estimate that fire blight outbreaks could only happen once
every 29,057 years. By contrast, the application of a 95% confidence limit results in a P5 value
of 0.0016 and an estimate that fire blight outbreaks could happen once every 6876 years –
approximately one quarter of New Zealand’s estimate.
375.
Significantly, when the Roberts and Sawyer (2008) P5 probability of apples carrying E.
amylovora is adjusted to reflect the lack of risk management measures in New Zealand, and a
95% confidence limit is applied to the P5 value, the estimated years until the first outbreak is
474 years. Leaving aside that the IRA Team’s actual estimate, expressed in years to outbreak, is
once in 22 years, even if the 446 year figure is combined with the consequences assessment in
the Final IRA Report, the risk associated with fire blight still exceeds Australia’s ALOP.
d.
376.
Summary
Australia has shown that Roberts and Sawyer (2008) is not a risk assessment and is not
based on sound science. It relies on data that is experimentally flawed. It applies confidence
levels to the calculation of probability estimates which result in estimated years to first outbreak
that are grossly exaggerated. Significantly, it constructs highly inappropriate risk scenarios
based on conditions bearing no plausible relationship to the assessment of the unrestricted risks
of fire blight associated with the importation of apples from New Zealand without any risk
management measures. Australia therefore submits that the Panel should treat all of New
Zealand’s arguments based on this flawed study with a high degree of caution.
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(b)
377.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team’s analysis of the probability of entry is objective and credible
New Zealand argues that lower (often “negligible”) likelihoods should have been
assigned to Importation steps 2 to 7.377 However, its arguments are made on the basis of
selective evidence used to advance only one interpretation of the likelihood of entry.
To
properly discharge its burden of proof, New Zealand must show that the actual likelihood values
assigned by the IRA Team on the basis of all the evidence, assessed in the context of Australia’s
circumstances, are not credible. It does not do this. Accordingly, Australia submits that the
importation scenario is a proper evaluation of “entry”.
i.
378.
Importation step 1
Importation step 1 focuses on the presence or absence of E. amylovora in source orchards
in New Zealand. If E. amylovora is absent from an area, there is no likelihood that the apples
exported from orchards in that area can transmit the disease causing organism to a new area.
Since the IRA Team found that “[t]here is no scientific literature that indicates that any area of
New Zealand is free of the fire blight bacteria and MAFNZ has not provided any information in
support of freedom for any apple producing areas in New Zealand”378, it concluded that the
likelihood that E. amylovora is present is 1.
379.
New Zealand misunderstands the purpose of Importation step 1. It claims that “it is
widely accepted in the scientific literature and by the scientific community that fruit from
orchards with no symptoms of fire blight do not harbour populations of E. amylovora.”379
However, Importation step 1 is not concerned with the presence of E. amylovora on fruit380, nor
is it concerned with the occurrence (or non occurrence) of disease symptoms. It is concerned
exclusively with the presence of E. amylovora in source orchards. Bacterial infestation of apple
fruit was appropriately considered under Importation step 2. The IRA Team also considered that
the scientific literature and evidence did not show that the absence of fire blight symptoms in an
orchard would indicate the absence of E. amylovora because:
New Zealand’s first written submission, para. 4.236.
Final IRA Report, Part B, p. 54 (emphasis added).
379
New Zealand’s first written submission, para. 4.210 (emphasis added).
380
Bacterial infestation of apple fruit is considered under Importation step 2.
377
378
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18 July 2008
Erwinia amylovora was detected in New Zealand both from orchards with fire
blight symptoms (Hale et al., 1987; Clark et al., 1993) and those without
symptoms (Clark et al., 1993).381
380.
New Zealand claims that the IRA Team was wrong to rely on Clark et al. (1993)382 to
support the statement that E. amylovora was found in an orchard without symptoms.383 Australia
disagrees. New Zealand itself states that Clark et al. (1993) reports that E. amylovora was found
on immature fruit from two orchards with no fire blight symptoms at flowering, although
infected alternative hosts were found in close proximity to the two orchards.384 The statement
made in the Final IRA Report therefore accurately reflects Clark et al. (1993) in this regard:
E. amylovora was found in orchards without fire blight symptoms.
381.
Clark et al. (1993) states that subsequently, 60,000 fruit from orchards verified free of
fire blight symptoms were tested and E. amylovora was not found on any fruit. New Zealand
claims this shows that “fruit from orchards with no symptoms of fire blight do not harbour
populations of E. amylovora.”385 However, Australia notes that New Zealand omits reference to
the measures put in place “prior to testing to reduce the possibility of fire blight infecting
orchards”.386 The measures are outlined in the following terms:
A zone 250 metres around each orchard was required to contain no alternative
hosts for fire blight, and within a 500 metre zone around orchards no infected
hosts were allowed. Detailed inspections ensured that this was the case and
since the introduction of these stringent measures no Erwinia amylovora has
been detected in the calyxes of c. 60,000 fruit tested from the inspected
orchards.387
382.
Australia emphasises that the researchers had to use stringently maintained buffer zones
to keep E. amylovora out of orchards so that they could show that E. amylovora was not present
in orchards without fire blight symptoms. The use of these measures by the researchers clearly
demonstrates that the presence or absence of fire blight symptoms, on their own, are not a good
indicator of the presence or absence of E. amylovora in an orchard. The organism can be present
in orchards even if disease symptoms are not detected, or the orchard is surrounded by infected
381
Final IRA Report, Part B, p. 53.
Exhibit NZ-53: Clark, RG, CN Hale and D Harte (1993) "A DNA approach to Erwinia amylovora
detection in large scale apple testing and in epidemiological studies" Acta Horticulturae 338, 59-66.
383
New Zealand’s first written submission, para. 4.210.
384
New Zealand’s first written submission, para. 4.210.
385
New Zealand’s first written submission, para. 4.210.
386
Exhibit NZ-53: Clark et al. (1993), p. 62.
387
Exhibit NZ-53: Clark et al. (1993), p. 62 (emphasis added).
382
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18 July 2008
alternative hosts. This is precisely the point made in the discussion under Importation step 1 in
the Final IRA Report.388 Accordingly, New Zealand’s claim that “fire blight is not routinely
detected in all orchards in New Zealand” because the “disease is sporadic in nature”389 is also
irrelevant because it relates entirely to the detection of disease symptoms.
383.
The IRA Team did not misread the scientific literature, make incorrect assumptions or
fail to take account of scientific evidence. The IRA Team considered that relevant scientific
literature and evidence did not allow it to assess any apple producing areas of New Zealand
would be free of E. amylovora. Accordingly, Australia submits that New Zealand has not
presented any arguments or evidence that show the conclusions of the IRA Team in relation to
Importation step 1 are flawed.
ii.
384.
Importation step 2
Under Importation step 2, the IRA Team considered the likelihood that picked fruit is
infested or infected with E. amylovora. As the IRA Team was undertaking the unrestricted risk
analysis, it took into account that apples could be sourced from anywhere in New Zealand
irrespective of the fire blight status of the orchards.
385.
The IRA Team reviewed a significant body of scientific literature on the infection and
infestation of apple fruit.390 The IRA Team identified studies that found no evidence of the
presence of E. amylovora on mature apples and noted that some of these studies were carried out
on orchards showing symptoms of fire blight.
The IRA Team also identified studies that
confirmed the presence of E. amylovora on such fruit. Given the widespread distribution of fire
blight in New Zealand and the fact that the IRA Team were considering the unrestricted risk, the
IRA Team gave “much less weight” to studies that found no evidence of E. amylovora on mature
apples.391
386.
The IRA Team concluded that Importation step 2 should be represented by a triangular
distribution with a minimum value of 10-3 (0.1%), a maximum value of 5 x 10-2 (5%) and a most
likely value of 3 x 10-2 (3%). This means the IRA Team estimated that between 0.1% and 5% of
388
Final IRA Report, Part B, pp. 53-54.
New Zealand’s first written submission, para. 4.211.
390
Final IRA Report, Part B, pp. 55-65.
391
Final IRA Report, Part B, p. 65.
389
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18 July 2008
apples picked would be infested or infected with E. amylovora, with the most likely number of
apples being 3%.
387.
New Zealand claims that this range is based on a “misreading or discounting of the
scientific literature”.392 In its view, “[f]ire blight bacteria are not found internally in mature
apple fruit [and]…are only rarely to be found externally”. 393 New Zealand also asserts that “the
IRA does not distinguish between infestation and infection”.394 Consequently, New Zealand
contends that “the IRA assigns a probability for infection or infestation of mature fruit that is
over 20 times higher than is justified by the scientific evidence”. 395 Accordingly, New Zealand
claims that the IRA Team should have treated the likelihood for Importation step 2 as
“negligible”.396
388.
In contrast to the comprehensive analysis conducted by the IRA Team, New Zealand
refers to only a handful of scientific studies in support of its claims, and places particular reliance
on the conclusions in Roberts and Sawyer (2008).397 Australia submits that New Zealand’s
assertions are without merit, as it will show in the following analysis.
a.
The IRA Team clearly distinguished between internal infection and
external infestation
389.
Contrary to New Zealand’s assertion, the IRA Team drew a very clear distinction
between internal infection and external infestation of apples. The analysis of Importation step 2
in the Final IRA Report is divided by headings titled “infestation of mature fruit”,398 “no
infestation of mature fruit”,399 “infection of mature fruit”400 and “no infection of mature fruit”,401
which indicate the kind of evidence being considered in each section.402
New Zealand’s first written submission, para. 4.213.
New Zealand’s first written submission, para. 4.16 (Article 2.2).
394
New Zealand’s first written submission, para. 4.216.
395
New Zealand’s first written submission, para. 4.219.
396
New Zealand’s first written submission, para. 4.220.
397
Exhibit NZ-29: Roberts and Sawyer (2008).
398
Final IRA Report, Part B, p. 55.
399
Final IRA Report, Part B, p. 61.
400
Final IRA Report, Part B, p. 62.
401
Final IRA Report, Part B, p. 64.
402
Final IRA Report, Part B, p. 55.
392
393
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Australia – Apples (DS367)
b.
390.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team found a paucity of evidence of internal infection
According to New Zealand, the “scientific evidence is clear” that internal infection of
mature, symptomless apples does not occur.403 In making this claim, New Zealand does not
acknowledge that the Final IRA Report concludes at the end of the section examining evidence
in support of internal infection that “the paucity of evidence of endophytic [internal] infection in
mature fruit suggests that if endophytic infection does take place it must be a rare event”. 404
New Zealand fails to note that the summary of Importation step 2 does not refer to the evidence
regarding internal infection at all, indicating that it was not given significant weight by the IRA
team in the assignment of the probability range for this step.
This is confirmed by the
explanation of the risk scenario which states that “[t]he importation risk scenario of particular
relevance to E. amylovora is one that is associated with the epiphytic (external) infestation”.405
c.
The IRA Team’s estimated distribution for Importation step 2 is
supported by scientific evidence
391.
New Zealand claims that the probability distribution assigned by the IRA Team to
Importation Step 2 is an “overestimation of the rate of infestation”406 since bacteria are found
externally “only rarely”407 and “generally only … on fruit from the few orchards that are
occasionally severely affected with fire blight”.408 New Zealand seeks to impugn the IRA
Team’s distribution by first challenging two of the references it relies upon, Clark et al. (1993)409
and van der Zwet et al. (1990)410, and then drawing comparisons to a number of other studies,
especially Roberts and Sawyer (2008), which it considers support much lower levels of
infestation.411 In Australia’s view, this claim is based on a selective reading of the evidence
which, in places, misrepresents the scientific studies actually relied on by New Zealand.
New Zealand’s first written submission, para. 4.11 (Article 2.2); see also para. 4.216.
Final IRA Report, Part B, p. 64.
405
Final IRA Report, Part B, p. 52.
406
New Zealand’s first written submission, para. 4.216.
407
New Zealand’s first written submission, para. 4.16 (Article 2.2). Australia notes that New Zealand does
not refer to the levels of infestation in a consistent manner. For example, at para. 4.16, infestation is considered to
be “rare”, whereas in para. 4.13, infestation is only “uncommon”.
408
New Zealand’s first written submission, para. 4.13 (Article 2.2).
409
Exhibit NZ-53: Clark et al. (1993).
410
Exhibit AUS-31: van der Zwet T, Thomson SV, Covey RP and Bonn WG (1990) “Population of
Erwinia amylovora on external and internal apple fruit tissues”, Plant Disease 74(9): 711-716.
411
New Zealand’s first written submission, paras. 4.214 – 4.219.
403
404
137
Australia – Apples (DS367)
392.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand refers to a typographical error in Clark et al. (1993) implying that the IRA
Team should not have relied upon it.412 Australia notes that New Zealand did not make this
point in its comments on earlier drafts of the Final IRA Report. In any event, such a claim is
inconsequential as the IRA Team did not place significant weight on that aspect of the study.
393.
New Zealand argues that the IRA Team could not rely on the findings of van der Zwet et
al. (1990) to support the presence of E. amylovora on the surface of mature fruit because Dr van
der Zwet advised in the context of the Japan – Apples dispute that the fruit tested were
immature.413 New Zealand takes issue with the following statement from the Final IRA Report:
In the USA, van der Zwet et al. (1990) showed that approximately 4% of
apparently noninfested mature fruit sourced from a symptomless orchard
developed fire blight symptoms when wounded on the surface. This indicates
that bacteria were present on the external surface of the fruit.414
394.
Australia provides van der Zwet et al. (1990) as an exhibit. Australia also provides a
copy of the declaration made by Dr van der Zwet in the context of the Japan – Apples case.415
395.
It does not appear that New Zealand consulted the declaration made by Dr van der Zwet.
If New Zealand had done so, it would have discovered that the particular fruit puncture
experiment referred to by the IRA Team was not covered in Dr van der Zwet’s declaration that
immature fruit may have been used in other experiments. As such, there is no basis for New
Zealand to suggest that Dr van der Zwet’s declaration in Japan – Apples casts doubt on the
quoted reference to van der Zwet et al. (1990) in the Final IRA Report.
396.
Beyond its claims in relation to Clark et al. (1993) and van der Zwet et al. (1990), New
Zealand compares the distribution applied by the IRA Team for Importation step 2 with
estimates of the likelihood of infestation in other studies. In Australia’s view, this is not a proper
discharge of New Zealand’s burden of proof. As argued above, it is not enough to show that
there is an alternative scientific account of a particular phenomenon. New Zealand has to show
that the account given in the Final IRA Report is not credible. It has not done so. Australia
submits that the Panel should reject New Zealand’s arguments on this basis alone. However,
New Zealand’s first written submission, para. 4.214.
New Zealand’s first written submission, para. 4.215.
414
Final IRA Report, Part B, p. 56.
415
Exhibit AUS-32: van der Zwet, T. (2002) "Declaration of Dr Tom van der Zwet", 16 July, 2002
(provided as Exhibit US-18 in Japan-Apples).
412
413
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18 July 2008
even if the alternative assessments of likelihood are taken at face value, Australia will show that
they are nevertheless unconvincing.
397.
Ignoring the fact that Importation step 2 is represented by a probability range, New
Zealand argues that the most likely value of 3% is higher than infestation rates ascertained in
previous studies,416 and higher than the maximum infestation rates reported in New Zealand.417
On this basis, it argues that “[i]nfestation rates are normally much lower than 3% or more likely
close to zero”.418 New Zealand places particular reliance on Roberts and Sawyer (2008) which
estimates the likelihood of infestation to be 0.14% and argues that the estimate of probability
assigned by the IRA Team is “20 times higher than is justified by the scientific evidence”. 419
398.
The IRA Team assessed a substantial number of studies. Table 4 below420 summarises
the studies that have detected E. amylovora on mature apples. This table shows that the range of
values chosen for Importation step 2 in the Final IRA Report are justified based on the scientific
literature and clearly illustrate that the interpretation of the science put forward by New Zealand
to justify the claim that E. amylovora is found only rarely on mature apple fruit is highly
selective.
New Zealand’s first written submission, para. 4.216.
New Zealand’s first written submission, para. 4.217.
418
New Zealand’s first written submission, para. 4.217.
419
New Zealand’s first written submission, para. 4.219.
420
Final IRA Report, Part B, pp. 55-61.
416
417
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18 July 2008
Table 4: Results of studies testing for the presence of E. amylovora
Apples with E.
Location of study
Reference
Comment
New Zealand
Hale et al. (1987)421
Detection threshold around
amylovora
<1%
10,000 cells per apple
2%
New Zealand
Hale and Taylor (1999)422
Detection threshold around 10 –
100 per apple
2.8%
United States
van der Zwet et al. (1990)423
Detection threshold around
10,000 cells per apple
75%
United States
McManus and Jones (1995)424
Technique does not differentiate
between live and dead cells
4%
United States
van der Zwet et al. (1990)425
Detection threshold around
10,000 cells per apple
at least 33%
Canada
Sholberg et al. (1998)426
Detection threshold around
10,000 cells per apple
399.
Australia agrees that in some seasons, for some areas in New Zealand, it is possible that
the number of fruit carrying E. amylovora may be significantly lower than 3%. On the other
hand, it is also possible that the number of fruit carrying fire blight may be significantly higher
(see Table 4 above). The IRA Team took into account the fact that fire blight disease is highly
variable depending on the season, the fruit varieties being grown, the microclimate in orchards
and the control measures undertaken in orchards.427 This is the reason why the IRA Team used
the range of values from 0.1% to 5% to estimate the number of apples carrying E. amylovora.
Exhibit NZ-21: Hale, CN, EM McRae and SV Thomson (1987) “Occurrence of Erwinia amylovora on
apple fruit in New Zealand” Acta Horticulturae 217, 33-40.
422
Exhibit NZ-24: Hale, CN and RK Taylor (1999) “Effect of cool storage on survival of Erwinia
amylovora in apple calyxes” Acta Horticulturae 489,139-143.
423
Exhibit AUS-31: van der Zwet et al. (1990).
424
Exhibit AUS-33: McManus, P.S. and Jones, A.L. (1995) "Detection of Erwinia amylovora by nested
PCR and PCR-Dot-Blot and Reverse-Blot hybridizations" Phytopathology 85, pp618-623.
425
Exhibit AUS-31: van der Zwet et al. (1990).
426
Exhibit AUS-34: Sholberg PL, Gaunce AP and Owen GR (1988) “Occurrence of Erwinia amylovora of
pome fruit in British Columbia in 1985 and its elimination from the apple surface” Canadian Journal of Plant
Pathology 10, pp. 178-182.
427
Exhibit AUS-3: Final IRA Report, Part C, pp. 108-117.
421
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18 July 2008
By focussing only on the 3% most likely value, New Zealand fails to appreciate that the IRA
Team’s decision to use a range of values to represent probability was designed to reflect the
uncertainty caused by seasonal variations.
400.
Indeed, Roberts and Sawyer (2008) appears to be consistent with this range. For the
group of orchards where no phytosanitary requirements were implemented, the study concluded
that the probability that a fruit is contaminated with E. amylovora was 0.0200382.428
401.
Australia has shown why it does not consider Roberts and Sawyer (2008) to be reliable.
Roberts and Sawyer (2008) concludes,429 on the basis of an examination of the literature,
including Hale et al. (1987), that populations of E. amylovora associated with “apple fruit
decline during the growing season to zero or near-zero at harvest” and therefore none of the
evidence for E. amylovora on immature fruit is relevant. Australia submits that this conclusion is
unsafe. None of the studies relied upon by Roberts and Sawyer (2008) were sensitive enough to
detect very low numbers of E. amylovora on or in apple fruit.
402.
Hale and Clark (1990)430 showed that the plating technique used in many of the older
experiments (for example, Hale et al. 1987431) relied upon by New Zealand and Roberts and
Sawyer (2008) may only have been capable of detecting a minimum of 10,000 cells of
E. amylovora per fruit. The DNA hybridisation technique used in Hale and Clark (1990) was
sensitive enough to detect 100 cells of E. amylovora in calyces of apples.
Although this
approach is more sensitive than plating techniques, apples carrying less than 100 cells of
E. amylovora would not have been detected and would have been falsely reported as negative.
403.
McManus and Jones (1995)432 also provides support for the possibility that many of the
older studies may have significantly underestimated the number of mature apples carrying
E. amylovora. Using very sensitive techniques they found that 27 to 75% of mature apples
tested positive for E. amylovora.433
428
Exhibit NZ-29: Roberts and Sawyer (2008), p. 366.
Exhibit NZ-29: Roberts and Sawyer (2008), pp. 363-364.
430
Exhibit AUS-35: Hale CN and Clark RG (1990) "Detection of Erwinia amylovora from apple tissue by
DNA hybridisation" Acta Horticulturae 273, pp. 51-55.
431
Exhibit NZ-21: Hale et al. (1987).
432
Final IRA Report, Part B, p. 56; Exhibit AUS-33: McManus and Jones (1995).
433
The techniques used in this work are not capable of distinguishing between live E. amylovora and dead
E. amylovora. It is not appropriate to assume, as Roberts et al. (1998) and New Zealand seem to have done, that the
429
141
Australia – Apples (DS367)
404.
Australia’s First Written Submission of Australia
18 July 2008
In these older experiments, fruit with less than 10,000 cells of E. amylovora would have
been falsely treated as uninfested. Given that even one bacterium on an apple may be
epidemiologically significant, this is a serious shortcoming in Roberts and Sawyer (2008) and
undermines the reliance placed on this study by New Zealand.
405.
Roberts and Sawyer (2008) also dismisses the notion that E. amylovora could enter
into a viable but non-culturable (VBNC) state on the basis that it had not been demonstrated in
mature apple fruit.434 However, studies conducted by Biosca et al. (2004)435 and Ordax et al.
(2006)436 indicate that E. amylovora can enter into a VBNC state. E. amylovora is able to
survive and remain infective for six months in sterile irrigation water and the culturability and
pathogenicity of copper-induced VBNC E. amylovora can be restored, at least under the sterile
conditions used in their experiments. Copper is frequently used as a pest control chemical in
apple orchards. More recent work submitted for publication by the same research group showed
that E. amylovora entered a VBNC state in the calyx of mature apples when treated with copper
at various concentrations. Recovery of viable, fully pathogenic cells was achieved at least up to
28 days from the start of the experiment. Although the design of these experiments did not allow
estimation of the proportion of inoculated bacteria that was able to recover, these experiments
clearly indicate that the VBNC state can exist in the calyces of mature apple fruit.437
406.
Another issue not addressed in the New Zealand submission on Importation step 2 is the
potential for significant events through the growing season, such as hail storms or rainstorms, to
result in surface infestation of apples with E. amylovora. Presumably, New Zealand does not
dispute the analysis in the Final IRA Report that events such as these can lead to surface
contamination of apples with E. amylovora.438
d.
Summary
positive detections reported by McManus and Jones are simply the remains of dead E. amylovora still present on the
mature apples and that this study can be ignored.
434
Exhibit NZ-29: Roberts and Sawyer (2008), p. 365.
435
Biosca, E.G., Marco-Noales, E., Ordax, M. and Lopez, M.M. (2004) “Long-term starvation-survival of
Erwinia amylovora in sterile irrigation water” Proceedings on the 10th International Workshop on Fire blight,
Bologna, Italy, 5th-9th July 2004, Acta Hort 704, pp. 107-112.
436
Ordax, M., Marco-Noales, E., López, M.M. and Biosca, E.G. (2006) “Survival strategy of Erwinia
amylovora against copper: Induction of the viable-but-nonculturable state” Applied and Environmental
Microbiology 72 (5): 3482-3489.
437
Exhibit AUS-36: Ordax, M., Biosca, E.G., Wimalajeewa, S.C., Lopez, M.M., and Marco-Noales, E.,
“Survival of Erwinia amylovora in mature apple fruit calyces”, 2008 (submitted for publication), p. 11-14.
438
Final IRA Report, Part B, p. 56-57.
142
Australia – Apples (DS367)
407.
Australia’s First Written Submission of Australia
18 July 2008
Australia has shown that the IRA Team drew a very clear distinction between internal
infection and external infestation of apples in its analysis of Importation step 2. Australia has
shown that the IRA Team acknowledged the paucity of evidence of internal infection in mature
fruit. The IRA Team recognised that the importation risk scenario of particular relevance to
E. amylovora is the one associated with the external infestation of apples.
408.
Australia identified New Zealand’s attempt to compare the distribution applied by the
IRA Team for Importation step 2 with estimates of the likelihood of infestation in certain studies
as a failure on its part to discharge its burden of proof.
409.
Australia noted the limitations on the sensitivity of experimental techniques used in a
range of studies cited by Roberts and Sawyer (2008) and showed that they overlooked the
potential impact of VBNC E. amylovora. These facts undermine the reliance placed on the study
by New Zealand. In addition, Roberts and Sawyer (2008) is not a risk assessment and, as such,
should not be regarded as equivalent to the Final IRA Report.
410.
Australia demonstrated that New Zealand’s claim that the probability range assigned by
the IRA Team to Importation step 2 is “20 times higher than is justified by the scientific
evidence”439 is without merit. It is only possible to arrive at this conclusion if the probability
assigned to Importation step 2 is limited only to the most likely value of 3%, and the “science” is
confined to the estimate provided by Roberts and Sawyer (2008) of 0.14%.440 This cannot be
supported on the facts. Importation step 2 is a represented by a distribution, not a single value.
The conclusions of Roberts and Sawyer (2008) are not incontrovertible scientific fact, but merely
one estimate of infestation based on studies using unreliable experimental techniques.
411.
Accordingly, Australia submits that New Zealand’s attempts to mischaracterise both the
IRA Team’s actual estimate of probability and the scientific evidence on external infestation
should be rejected by the Panel.
iii.
412.
Importation step 3
Importation step 3 addresses the potential for apples being harvested and transported to
packing houses to be contaminated with E. amylovora that may be present, for example, in ooze
439
440
New Zealand’s first written submission, para. 4.219.
3% is approximately twenty times the magnitude of 0.14%.
143
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18 July 2008
on trees, on the hands of pickers, picking bags, bins or machinery. On the basis of the scientific
literature, the IRA Team concluded that fruit could become contaminated at picking through
wounds as well as surface contamination, especially if rain occurred during harvest.441
Accordingly, the IRA Team represented Importation step 3 as a triangular distribution with a
minimum value of 10-3 (0.1%), a maximum value of 3 x 10-2 (3%) and a most likely value of 10-2
(1%).
413.
New Zealand claims that the “most likely value of 1% ... has no basis in science”. 442
Again, New Zealand fails to appreciate the range in the scientific data available in respect of the
probability of particular events occurring, with the result that it seeks to limit a probability
distribution to a single figure.
414.
Two arguments underpin New Zealand’s claim. First, it claims that the only place where
E. amylovora survive are in the calyx and “thus [they are] not available to contaminate
anything”.443 Secondly, New Zealand asserts that external populations of E. amylovora on the
fruit surface and leaves will be insufficient to cause contamination.444
415.
Australia agrees that bacteria in the calyx are “not available to contaminate anything”.
However, this misses the point that Importation step 3 is not focussed on bacteria from the calyx
as a direct source of contamination. The sources of contamination considered most likely by the
IRA Team were surface infestation and E. amylovora on leaves, in the orchard environment, on
the hands of pickers and on bins and machinery.445
416.
The IRA Team took into account the work of Ockey and Thomson (2006). This study
showed that the leaf area covered by E. amylovora can increase from zero to 24% immediately
after rain and decline to zero again a day after rain.446 Under these conditions, the IRA Team
reasonably concluded that any picking operations carried out shortly after rain would result in a
very high level of contamination as pickers’ hands, clothing and picking bins would become
441
Final IRA Report, Part B, pp. 66-71.
New Zealand’s first written submission, para. 4.221. Australia notes again that New Zealand
concentrates only on the most likely value and does not make arguments in relation to the actual probability
distribution assigned to Importation step 3 representing a range of values.
443
New Zealand’s first written submission, para. 4.223; see also: para. 4.21 (Article 2.2).
444
New Zealand’s first written submission, para. 4.222; see also: para. 4.20 (Article 2.2).
445
Final IRA Report, Part B, pp. 66–70.
446
Exhibit NZ-26: Ockey, SC and SV Thomson (2006) "Influence of rain on transient populations of
Erwinia amylovora on leaf surfaces" Acta Horticulturae 704, 1B-1 19, pp. 113-119.
442
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contaminated.447 However, the IRA Team concluded that not all orchards in all seasons would
be subject to high levels of contamination and therefore it was not appropriate to base the
estimation for Importation step 3 wholly on such circumstances.
417.
New Zealand refers to a number of studi`es448 showing that E. amylovora has short
survival rates when exposed to solar radiation and is generally regarded as a poor epiphyte (i.e.
does not grow on surfaces well). It is true to say that E. amylovora does not multiply on dry
surfaces exposed to sunlight, but it clearly has the capacity to survive in the environment quite
well, rapidly multiplying and infecting wounds on apples when conditions are favourable
(Sholberg et al. 1998).449
418.
The Final IRA Report acknowledges that the likelihood of contamination arising from
sources such as ooze on trees, the hands of pickers, picking bags, bins or machinery is “very
small” and the likelihood of transfer is “even lower”.450 This is why the probability range
assigned by the IRA Team is skewed to the lower end of the distribution. New Zealand has
provided no argument as to why the IRA Team’s use of such a range, designed specifically to
reflect the low probability of contamination, should be considered flawed.451
iv.
419.
Importation step 4
Importation step 4 considers the likelihood that E. amylovora would survive the
operations carried out in the packing house. The IRA Team considered a substantial number of
studies and information on the use of a wide range of operations in New Zealand packing houses
including, pre-cooling, washing, disinfection, brushing, sorting and grading, packaging and cool
storage.452 On this basis, the IRA Team considered that Importation step 4 should be represented
447
Final IRA Report, Part B, p. 71.
New Zealand’s first written submission, para. 4.20 (Article 2.2); Exhibit NZ-96: Dueck, J (1974)
“Survival of E. amylovora in association with mature apple fruit” Canadian Journal of Plant Science 54, 349-351;
Exhibit NZ-97: Roberts, RG, ST Reymond and RJ McLaughlin (1989) “Evaluation of mature apple fruit from
Washington State for the presence of E. amylovora” Plant Disease 73, 917-921; Exhibit NZ-21: Hale et al. (1987);
Exhibit NZ-20: Roberts, RG (2002) “Evaluation of Buffer Zone Size and Inspection Number Reduction on
Phytosanitary Risk Associated with Fire Blight and Export of Mature Apple Fruit” Acta Horticulturae 590, 47-53;
Exhibit NZ-5: Thomson, SV (2000) “Epidemiology of fire blight” in Vanneste, JL (Ed) Fire Blight: The Disease
and its Causative Agent, Erwinia amylovora, CABI 'Publishing, CAB International, Wallingford, UK, 9-36; and
Exhibit NZ-26: Ockey and Thomson (2006).
449
Exhibit AUS-34: Sholberg et al. (1998), p. 180.
450
New Zealand’s first written submission, para. 4.222 (quoting the Final IRA Report, Part B, p. 69).
451
New Zealand’s first written submission, para. 4.224.
452
Final IRA Report, Part B, pp. 71-77.
448
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18 July 2008
by a triangular distribution with a minimum value of 0.3 (30%), a maximum value of 0.7 (70%)
and a most likely value of 0.65 (65%). The most likely value of 65% represents an outcome
which would see the number of apples with E. amylovora reduced by 35% during processing.
The maximum value of 70% would see the number of apples with bacteria reduced by 30%
during processing and the minimum value of 30% would result in a 70% reduction of apples
carrying bacteria.
420.
New Zealand argues that this distribution should be revised purely on the basis that there
is some evidence which shows that cold storage has a negative impact on the survival of
E. amylovora.453 In its view, Importation step 4 is based on an “assumption rather than on
scientific data”454 and therefore, should have been “treated as an event with a much lower
probability”455, namely, “negligible”.456
New Zealand has not made a claim concerning the
effects of brushing, waxing, sorting and grading and packaging as considered by the IRA Team,
and should not be permitted to expand its claims in relation to these issues at a later stage of
proceedings.
421.
Australia denies that the probability range assigned to Importation step 4 can be reduced
to a mere “assumption”. Given the risk scenario addressed by the IRA Team, E. amylovora will
be taken to have survived this step even if only one bacterium survives routine pack house
procedures on any given apple. New Zealand seems to have relied upon the argument related to
the epidemiological significance of low bacterial numbers457 rather than directly addressing the
issue evaluated in Importation step 4. Viewed in this light, New Zealand’s arguments in relation
to cold storage actually support Australia’s position.
422.
Australia agrees with New Zealand that the scientific literature indicates that the number
of E. amylovora on or in apples declines with cold storage.458 However, the scientific studies
cited by New Zealand in apparent support of its case clearly show that while bacterial
New Zealand’s first written submission, para. 4.226; see also: paras 4.17-4.19 (Article 2.2).
New Zealand’s first written submission, para. 4.225.
455
New Zealand’s first written submission, para. 4.227.
456
New Zealand’s first written submission, para. 4.225.
457
See for example: New Zealand’s first written submission, para. 4.17 (Article 2.2).
458
Final IRA Report, Part B, p. 109.
453
454
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18 July 2008
populations decline, they do not disappear.459
Even if the eventual decline in viable
E. amylovora to zero is taken into account, apples could be processed, shipped to Australia and
be available for retail sale before the numbers of E. amylovora on apples declined to this level.
423.
Australia submits that the scientific evidence on the time course of decline in numbers
during cold storage is not as clear cut as implied by New Zealand. The IRA Team examined
data from Taylor and Hale (1999)460 which clearly indicates that E. amylovora survived in
calyces of apples for more than 25 days – significantly longer than the minimum 10 days needed
to transport apples from New Zealand to Australia by ship.
424.
Two recent studies lend further weight to the conclusions in the Final IRA Report. The
first, Temple et al. (2007),461 presents data showing that bacteria survived better on fruit in cold
storage than at room temperature, and that the best survival was in controlled atmosphere
conditions as used in longer term commercial storage of apples. Cold temperatures prolong the
survival of bacteria compared to warmer temperatures as cooler temperatures slow down
metabolic activity and effectively allow bacteria to survive for long periods in a quiescent state.
Storage in cold conditions is one of the standard approaches to storing bacteria in laboratories.
425.
The second study, Ordax et al. (2008),462 subjected mature apples inoculated in the calyx
with E. amylovora to storage at 26°C and 5°C. At 5°C there was less than a 10-fold decline in
bacterial numbers over 35 days – the maximum time used in these experiments. However, at
26°C there was a 1000-fold decline over 28 days although bacteria could still be detected at 35
days when apples were inoculated with 105 cells.463 This is further evidence in support of the
IRA Team’s judgment that E. amylovora on apples could survive cold storage for sufficient time
to be imported and distributed in Australia.
459
New Zealand’s first written submission, para. 4.226 in which Exhibit NZ-24: Hale and Taylor (1999);
Exhibit NZ-25: Taylor, RK and CN Hale (2003) “Cold storage affects survival and growth of Erwinia amylovora
on the calyx of apple” Letters in Applied Microbiology 37(4), 340-343 and Exhibit NZ-98: Temple, TN, VO
Stockwell, PL Pusey and KB Johnson (2007) “Evaluation of Likelihood of Co-Occurrence of E. amylovora with
Mature Fruit of Winter Peal” Phytopathology 97(10),1263-1273 are cited. Exhibit NZ-24 and Exhibit NZ-25 are
also cited in New Zealand’s first written submission para. 4.18 (Article 2.2).
460
Exhibit NZ-24: Hale and Taylor (1999).
461
Exhibit NZ-98: Temple et al. (2007).
462
Exhibit AUS-36: Ordax et al. (submitted for publication in 2008).
463
Exhibit AUS-36: Ordax et al. (submitted for publication in 2008), pp. 7 & 9.
147
Australia – Apples (DS367)
426.
Australia’s First Written Submission of Australia
18 July 2008
Australia has shown that the scientific evidence on the decline in numbers of
E. amylovora during cold storage is not as clear cut as implied by New Zealand. In fact, the
scientific evidence relied on by New Zealand suggests that bacteria can survive, even during
periods of cold storage. Australia has demonstrated that the probability range assigned to
Importation step 4 cannot be reduced to a mere “assumption”. Accordingly, Australia submits
that New Zealand has failed to show that the probability range assigned to Importation step 4 is
flawed.
v.
427.
Importation step 5
Under Importation step 5, the IRA Team assessed the likelihood that apples entering the
packing houses free of E. amylovora would become contaminated during processing. The IRA
Team considered that the most significant source of fruit contamination in the packing house is
the water in the dump tank and the wash water that apples may be exposed to through the
grading and packing process.464 In particular, if bacteria are washed off apples, bins or trash
(leaves and twigs) then the water will provide an efficient mechanism to contaminate clean apple
fruit. Contamination by this process is normally addressed by adding disinfectant at a suitable
concentration to the process water. However, data provided by New Zealand cited in the Final
IRA Report indicates that only 53% of New Zealand packing houses use some sort of
disinfectant.465 On this basis, the IRA Team decided to represent the likelihood of clean fruit
being contaminated with E. amylovora during processing as a triangular distribution, with a
minimum value of 10–3 (0.1% of fruit), a maximum value of 5 x 10–2 (5% of fruit) and a most
likely value of 2.5 x 10–2 (2.5% of fruit).
428.
New Zealand offers little substantive argument in relation to Importation step 5, making
it hard to understand its complaint. Taken with its related arguments under Importation steps 3
and 7, as well as its argument under Article 2.2,466 New Zealand appears to argue that mature
apples do not carry E. amylovora and, therefore, the likelihood of fruit contamination at
Importation step 5 is even lower than at Importation step 3. However, Importation step 5
addresses the likelihood that clean fruit is contaminated by E. amylovora during processing in
the packing house.
Therefore, the question that is being asked is: if apples carrying E.
464
Final IRA Report, Part B, pp. 77-78.
Final IRA Report, Part B, p. 77.
466
New Zealand’s first written submission, paras. 4.20 – 4.21 (Article 2.2).
465
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18 July 2008
amylovora are processed with apples free of E. amylovora, what is the likelihood that clean
apples will become contaminated?
The presence (or absence) of E. amylovora on apples
entering the packing house is dealt with under Importation steps 2 and 3.
429.
Accordingly, Australia submits that New Zealand has misunderstood the intention of
Importation step 5, and how the importation steps operate together. Consequently, it fails to
establish any basis at all why the IRA Team’s judgment in relation to Importation step 5 should
be considered flawed.
vi.
430.
Importation step 6
Importation step 6 addresses the likelihood that E. amylovora will survive palletisation,
quality inspection, containerisation and transportation to Australia. Taking into account that
bacteria are not visible and the evidence presented at Importation step 4 that bacteria will survive
cold storage conditions, the IRA Team concluded that none of the processes at Importation step
6 are likely to directly impact on the survival of E. amylovora on fruit.
431.
Accordingly, the IRA Team represented Importation step 6 as a triangular distribution
with a minimum value of 0.7 (70%), a maximum value of 1 (100%) and a most likely value of
0.8 (80%). The most likely value of 80% represents an outcome which would see the number of
apples with E. amylovora reduced by 20% during transportation. The maximum value of 100%
would see no reduction in the number of apples with the bacteria and the minimum value of 70%
would result in a 30% reduction.
432.
New Zealand’s argument in respect of Importation step 6 is essentially a repetition of the
arguments it makes under Importation step 4. It again refers to Hale and Taylor (1999), Taylor
and Hale (2003) and Temple et al. (2007) in support of its claim that cold storage “significantly
reduces the viability of E. amylovora”.467 New Zealand argues that E. amylovora will not
survive in “epidemiologically significant numbers”.468 Therefore, New Zealand asserts that the
IRA Team “attributed an inflated likelihood” to this step.
433.
New Zealand again misinterprets the objective of this importation step. Importation
step 6 does not test whether E. amylovora will survive in epidemiologically significant numbers.
467
468
New Zealand’s first written submission, para. 4.229.
New Zealand’s first written submission, para. 4.229.
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18 July 2008
It is concerned with the likelihood that any bacteria will survive quality controls, storage and
transport. The IRA Team acknowledged the likelihood that, at least during some of these
processes, apples will be stored at low temperatures. Australia submits that the IRA Team’s
findings in relation to cold storage are fully consistent with the scientific evidence demonstrating
that bacteria decline in cold storage.469 However, the IRA Team also took into account the fact
that the very same evidence also demonstrates that some bacteria can survive. This evidence has
already been discussed in the context of Importation step 4. Australia submits that this evidence
applies equally to Importation step 6.
434.
In Australia’s view, the evidence adduced by New Zealand in relation to Importation step
6 again supports rather than undermines the conclusions of the IRA Team. New Zealand refers
to the study conducted in Temple et al. (2007) in support of its claims. However, Figure 3470 in
this paper clearly shows that after 28 days in cold, controlled atmosphere storage approximately
90% of apples still carried E. amylovora and approximately 55% of apples stored in the cold
tested positive for E. amylovora. Control of carbon dioxide and oxygen levels combined with
cold storage are the standard commercial practices used to prolong the storage life of apples. By
contrast only 10% of apples stored at ambient conditions tested positive for E. amylovora. Given
that the minimum time for packing, transport and distribution to Australia is around 10 days,
demonstrated E. amylovora survival for greater than 28 days clearly means that E. amylovora on
apple fruit will not die before apples are imported into Australia.
435.
Accordingly, Temple et al. (2007) clearly shows that, if anything, cold storage prolongs
the life of E. amylovora on apples compared to storage at ambient temperatures. In fact, on the
basis of this study, cold storage with controlled atmosphere (a common commercial practice)
was the best condition for prolonging the life of E. amylovora on fruit.471
436.
Australia notes that New Zealand again relies on Roberts and Sawyer (2008)472, stating
that it estimated the probability for this step as 0.0035088, based on data from Hale and Taylor
(1999).473 As noted above, the IRA Team took into account data from Taylor and Hale (1999) in
arriving at the distribution for Importation step 6. Accordingly, Australia submits the probability
469
Final IRA Report, Part B, pp. 75-76 & 109.
Exhibit NZ-98: Temple et al. (2007), p. 1270.
471
Exhibit NZ-98: Temple et al. (2007), p. 1270.
472
Exhibit NZ-29: Roberts and Sawyer (2008), p. 367.
473
New Zealand’s first written submission, para. 4.230.
470
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18 July 2008
estimate in Roberts and Sawyer (2008) does not in any way support New Zealand’s claim that
the distribution assigned to Importation step 6 is “inflated”.
437.
New Zealand again fails to demonstrate a proper understanding of the importation
scenario examined by the IRA Team.
Much of the evidence presented in fact supports
Australia’s claim that the IRA Team was correct in its assessment of likelihood for Importation
step 6. Accordingly, Australia submits that New Zealand has failed to establish that the IRA
Team’s assessment of Importation step 6 is flawed.
vii.
438.
Importation step 7
Importation step 7 examines the likelihood that clean fruit is contaminated by
E. amylovora during palletisation, quality inspection, containerisation and transportation. The
IRA Team assessed that the only contamination risk under this step arose from bacterial ooze
from internally infected fruit. Given that it considered internal infection to be a “rare event”, 474
and that rotten fruit is highly likely to be discarded at harvest, at the packing line or during
quality inspection, the IRA Team considered there was little opportunity for fruit to be
contaminated at this stage.475 Accordingly, the IRA Team ascribed a triangular distribution to
this step, with a minimum value of 0, a maximum value of 10-6 (1 in 1 million), and a most likely
value of 5 x 10-7 (1 in 2 million).476
439.
New Zealand contends that this is an event “with an exceedingly small probability of
occurrence”, similar to Importation steps 3 and 5.477 New Zealand argues that Importation steps
3 and 5 should be assessed as “negligible” events.478
According to the IRA Team’s
methodology, the qualitative descriptor for “negligible” events corresponds with a probability
interval between 0 and 10-6.479
As this is precisely the probability interval assigned to
Importation step 7, New Zealand can have no complaint with Importation step 7.
474
Final IRA Report, Part B, p. 64.
Final IRA Report, Part B, p. 79.
476
Final IRA Report, Part B, p. 79.
477
New Zealand’s first written submission, para. 4.232.
478
See: New Zealand’s first written submission, paras. 4.221 & 4.228 respectively.
479
See: Final IRA Report, Part B, Table 12, p. 43.
475
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Australia – Apples (DS367)
viii.
440.
Australia’s First Written Submission of Australia
18 July 2008
Importation step 8
New Zealand agrees with the IRA Team’s assessment that Importation step 8 should be
represented by a certain probability of 1,480 but asserts that such a figure is “hardly meaningful”
because it “depends on the assumption that a pathway exists for the transmission of E.
amylovora”.481 This argument is irrelevant to this importation step, as New Zealand agrees with
the IRA Team that it is certain that any E. amylovora present by this step will survive to the next
stage. Again, New Zealand attempts to cast its objections to the pathway being examined as
errors in the actual assessment of that pathway.
ix.
441.
Summary on entry
In Australia’s view, New Zealand’s arguments exhibit a flawed understanding of the kind
of risk pathway actually being assessed in respect of fire blight, and how the importation steps
combine to provide an estimate of the probability of “entry”. New Zealand has failed to adduce
sufficient evidence of any flaws in the IRA Team’s assessment of the importation steps, let alone
any flaws serious enough to prevent the Panel from having “reasonable confidence” in the risk
assessment. Much of its evidence actually supports and confirms the IRA Team’s assessment.
(c)
The IRA Team’s analysis of the probability of establishment and spread is
objective and credible
442.
New Zealand argues that establishment and spread of fire blight through mature apples
has never been demonstrated.482 In New Zealand’s view, each step in the sequence of events that
constitute establishment and spread are “unproven”,483 and therefore the “probability of them
occurring in the correct sequence”484 when “a host blossom is susceptible and the climate is
conducive to infection”485 has to be “very close to zero”.486 New Zealand regards the IRA
New Zealand’s first written submission, para. 4.233.
New Zealand’s first written submission, para. 4.234.
482
New Zealand’s first written submission, paras. 4.247, 3.52-3.53, 4.7 & 4.27-4.30.
483
New Zealand’s first written submission, para. 4.246.
484
New Zealand’s first written submission, para. 4.247.
485
New Zealand’s first written submission, para. 4.246.
486
New Zealand’s first written submission, para. 4.247.
480
481
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Team’s evaluation of establishment and spread to be “hypothetical”487 and “grossly
exaggerated”.488
443.
In Australia’s view, this claim lacks merit. It is one thing to suggest that a pathway has
never been historically “proven”. It is altogether different to claim that because the occurrence
of an event has never been categorically established that it can never happen. This is an error in
logic.
Historical data may be a good predictor of future expectations, but it is never
determinative, especially when trying to predict how a disease may behave in an environment
that is presently free of that very disease.
444.
ISPM No. 11 recognises that scientific uncertainty is a particular challenge:
Estimation of the probability of introduction of a pest and of its economic
consequences involves many uncertainties. In particular, this estimation is an
extrapolation from the situation where the pest occurs to the hypothetical
situation in the PRA area. It is important to document the areas of uncertainty
and the degree of uncertainty in the assessment, and to indicate where expert
judgement has been used. This is necessary for transparency and may also be
useful for identifying and prioritizing research needs.489
445.
The risk assessment techniques promulgated by the IPPC, and therefore techniques that
Australia is obliged to take into account under Article 5.1, clearly permit the exploration of
hypothetical pathways. Moreover, ISPM No.11 acknowledges that expert judgment can and
must play a key role in risk assessments, like the Final IRA Report, which are designed to test
such pathways.
446.
Against this background, New Zealand’s claims pay insufficient attention to the
requirements of the international standards, and seek to unduly limit the kinds of pathway and
scientific evidence that can be considered.
The Final IRA Report fully discloses that the
scenario being assessed is not a particularly likely one490 – only that when potential
consequences are taken into account, it exceeds Australia’s ALOP. However, neither the SPS
Agreement nor the international standards require a risk assessment to examine only likely
pathways or conform to only one view of the mainstream science. The SPS Agreement does not
New Zealand’s first written submission, para. 4.252.
New Zealand’s first written submission, para. 4.250.
489
Exhibit AUS-6: International Plant Protection Convention, International Standard for Phytosanitary
Measures No. 11: Pest risk analysis for quarantine pests including analysis of environmental risks and living
modified organisms, 2004, para 2.4 (emphasis added). “PRA” refers to a Pest Risk Analysis Area.
490
Final IRA Report, Part B, p. 97.
487
488
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require a risk assessment to establish a minimum magnitude of risk and permits reliance upon a
range of scientific opinions emanating from qualified and respected sources.
447.
Accordingly, Australia submits that the proper enquiry is whether the likelihoods
assigned by the IRA Team are credible and objective. Australia will demonstrate that at each
stage in the pathway relating to establishment and spread, the IRA Team made a credible
assessment on the basis of the scientific evidence and accordingly, its evaluation should stand.
i.
448.
The IRA Team’s approach to calculating establishment and spread
Australia submits that the following steps would need to occur in sequence in order for
fire blight to establish and spread in Australia:

mature fruit must arrive in Australia carrying viable E. amylovora (the
importation steps and probability of importation discussed above);

the mature apple must be discarded near a susceptible host (the “proximity”
analysis in the Final IRA Report);

sufficient bacteria must contaminate a suitable vector (part of the “exposure”
analysis in the Final IRA Report);

the bacteria must be transmitted to a susceptible host (part of the “exposure”
analysis in the Final IRA Report);

the environmental conditions must be suitable for infection to establish (the
“establishment” analysis in the Final IRA Report); and

the conditions must be suitable, and means must be available, for the infection to
spread (the “spread” analysis in the Final IRA Report).
449.
New Zealand purports to present its own summary of the necessary steps,491 which has
significant shortcomings, including the assumptions that:
491
New Zealand’s first written submission, para. 4.246.
154
Australia – Apples (DS367)

Australia’s First Written Submission of Australia
18 July 2008
apple fruit must arrive in Australia with significant quantities of E. amylovora in
the calyx;

browsing insects are the only vector for transmission of E. amylovora to a host;

bacteria must multiply to 106 in a short period during conducive weather
conditions.492
450.
Australia will address these shortcomings below.
ii.
451.
New Zealand does not show that the proximity analysis is flawed.
Having established the probability distribution for imported apples with E. amylovora
(3.9% mean),493 the IRA Team then turned to its proximity analysis, assessing how apples from
New Zealand would be distributed, used and subsequently disposed of.
The IRA Team
established the likelihood that major handlers and users of apples (utility points) would be
sufficiently close to pest hosts (exposure groups) for transfer of pests from apples discarded by
handlers and users to host plants to take place (likelihood given as a proximity value).
452.
New Zealand asserts that, in order to support its arguments on establishment, the IRA
Team had:
… to assume that apples will arrive at certain “utility points” close enough to
host plants that there can be a transfer of bacteria from the infested apples to
the host plants.494
New Zealand’s use of “assume” implies that the analysis of the IRA Team was based on
theory.495 If apples from New Zealand are not going to pass through major handlers and users in
Australia, it is unclear to Australia how those apples would be distributed.
453.
Clearly, imported apples that do not come close to host plants have no chance of
vectoring E. amylovora and this was an important part of the IRA Team’s analysis. For fire
492
Australia notes that elsewhere in its submission, New Zealand asserts that 10 4 E. amylovora are
required, at minimum, to initiate an infection. (New Zealand’s first written submission, para. 4.244.)
493
Final IRA Report, Part B, p. 80.
494
New Zealand’s first written submission, para. 4.240.
495
New Zealand’s first written submission, para. 4.241.
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blight, the highest proximity values were given for orchard wholesalers near commercial fruit
crops (100%) and consumers being near household and garden plants (1%-15%).496
454.
New Zealand does not challenge any particular assignment of likelihood in the proximity
analysis, except the combination of urban retailers and commercial fruit crops. It merely makes
the vague statement that:
[Proximity v]alues are assigned in a seemingly arbitrary manner and events
that have an extremely low likelihood (urban retailers in proximity to
commercial fruit crops) are nevertheless assigned probability values which
suggest they are likely to occur.497
455.
No support is given for this statement and New Zealand makes no further argument on
this point. Australia therefore does not consider this statement to be a proper claim. However,
even if this assertion were taken at face value, New Zealand would nevertheless be incorrect.
456.
The IRA Team took into account that certain areas in Australia, such as the fringe of
major cities like Melbourne and Adelaide, where suburban areas blend into commercial
orchards, and small towns surrounded by orchards, where a small number of retailers would be
near commercial fruit crops. However, given that most retailers are based in large urban centres,
the IRA Team considered that it was unlikely that urban retailers would be proximate to
commercial fruit crops and therefore reflected this assessment as a uniform probability range
from 10-4 (0.01%) to 10-2 (1%).498 Australia fails to see how such a small probability range
could be interpreted by New Zealand as “likely to occur”. Accordingly, New Zealand’s claims
in relation to the IRA Team’s proximity analysis are weak and should be dismissed.
iii.
457.
E. amylovora can survive cold storage
New Zealand again returns to its argument that E. amylovora will not survive cold
storage. It relies on the same evidence and arguments as it did in relation to Importation step 4
and Importation step 6. As Australia has already responded to these this claim above,499 it
reiterates at this point that the scientific evidence clearly shows that E. amylovora can survive on
496
Final IRA Report, Part B, Table 19, p. 85. The IRA Team considered that all orchard wholesalers likely
to be handling New Zealand apples would be near commercial fruit crops. This is because orchard wholesalers are
located, as their name suggests, in apple and pear orchards.
497
New Zealand’s first written submission, para. 4.241.
498
Final IRA Report, Part B, p. 85.
499
See submission on Importation step 4 above.
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apples for periods considerably longer than needed to import, distribute and sell apples in
Australia.
iv.
The minimum number of bacteria needed to start fire blight disease is very
much lower than that claimed by New Zealand
458.
In order for E. amylovora to be successfully transmitted, bacteria need to be available in
sufficient quantities to initiate infection. This number is called the “inoculum dose”. 500 The IRA
Team reviewed literature on this issue and concluded that “there is no accepted threshold number
of bacteria required to initiate an infection, and this may vary with environmental and host
factors.”501 New Zealand rejects this conclusion. On the basis of only two studies502, it argues
that more than 10,000 bacterial cells of E. amylovora are required in the early stages of
flowering for successful initiation of infection of apple flowers.503 Indeed, it is this “fact” that
underpins New Zealand’s main objection to the risk scenario assessed by the IRA Team.
459.
Australia rejects New Zealand’s claim. Its choice of evidence is highly selective and
ignores other available studies considered in the Final IRA Report. For example, the Final IRA
Report considers the conclusions of van der Zwet (1994)504. This study showed that five bacteria
were sufficient to cause fire blight symptoms in apple flowers in one season, and 5,000 cells
were needed in another season.
Hildebrand (1937)505 found that only one bacterium was
sufficient when placed on the hypanthium.506 This is well below the minimum of 10,000 (104)
that New Zealand claims is needed to initiate infection.
500
Final IRA Report, Part B, p. 88.
Final IRA Report, Part B, p. 88
502
Exhibit NZ-54: Thomson, SV and SC Gouk (2003) “Influence of Age of Apple Flowers on growth of
Erwinia amylovora and biological control agents” Plant Disease 87(5), 502-509; Exhibit NZ-23: Taylor, RK, CN
Hale, WR Henshall, JL Armstrong, and JW Marshall (2003b) “Effect of inoculum dose on infection of apple (Malus
domestica) flowers by Erwinia amylovora" New Zealand Journal of Crop and Horticultural Science 31, 325-333.
See: New Zealand’s first written submission, para. 4.244.
503
New Zealand’s first written submission, para. 4.244. Australia notes that New Zealand is not consistent
on this point. In New Zealand’s first written submission para. 4.246, New Zealand asserts that the
epidemiologically significant number is 106.
504
Exhibit AUS-28: van der Zwet et al. (1994), pp. 225-230.
505
Exhibit AUS-29: Hildebrand (1937).
506
“Hypanthium” is the bowl-shaped part of a flower consisting of the bottoms of the sepal, petals and
stamens stuck together. Exhibit AUS-29: Hildebrand (1937), p. 851.
501
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460.
Australia’s First Written Submission of Australia
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New Zealand also only selectively refers to studies that have tested infection of apple
flowers. The IRA Team did not only consider apple trees to be at risk from fire blight.507 There
are over 100 other hosts of fire blight present in Australia that could also be exposed to E.
amylovora on imported apples.508 Little information is available about effective doses needed to
initiate disease on these hosts but, because of their impact on risk, they cannot be disregarded.
One such example is the ability of pear flowers to become infected.
461.
Cabrefiga and Montesinos (2005)509 studied the aggressiveness of a range of
E. amylovora strains. They estimated that the effective dose of bacteria needed to initiate disease
in pear flowers and immature pear slices ranged from one bacterial cell to 10,000 bacterial cells.
This confirms the conclusion reached by the IRA Team that, at least under some conditions, very
low numbers of E. amylovora are sufficient to start disease.
462.
Accordingly, Australia submits that there is clear evidence that the minimum number of
E. amylovora needed to start fire blight disease is much lower than that claimed by
New Zealand. The studies referred to above support the IRA Team’s conclusion that the number
of E. amylovora needed to start infection varies greatly and is highly dependent on
environmental conditions and host factors. New Zealand has not shown that any of these studies
in the Final IRA Report are wrong or irrelevant. Therefore, the Panel should reject New
Zealand’s claims. To the extent that New Zealand relies on this claim to support its objection to
the entire risk scenario, Australia submits that this objection should be found wholly without
support.
v.
463.
E. amylovora can rapidly multiply on or in fruit
The ability of E. amylovora to multiply increases the chance that an effective inoculum
dose will be available.
New Zealand claims that E. amylovora in the natural orchard
environment are unlikely to multiply at the rates seen under ideal laboratory conditions. 510 New
Zealand takes particular issue with only one reference in the Final IRA Report, Agrios (1997)511,
507
Final IRA Report, Part B, p. 89.
Final IRA Report, Part B, p. 90-91.
509
Exhibit AUS-37: Cabrefiga, J. and Montesinos, E. (2005) “Analysis of Aggressiveness of Erwinia
amylovora Using Disease-Dose and Time Relationships” Phytopathology 95, p. 1435.
510
New Zealand’s first written submission, para. 4.245.
511
Exhibit AUS-38: Agrios, G.N. (1997) Plant Pathology (Fourth Edition), Academic Press, pp. 411-412.
508
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which suggests that one bacterium could multiply to one million bacteria in ten hours. New
Zealand apparently ignores the clear qualification in the Final IRA Report that this is “provided
there is no competition from other micro-organisms and nutrient, temperature, humidity, as well
as moisture levels are optimal”512. New Zealand also omits any reference to three other studies
taken into account by the IRA Team513 which suggest that under certain conditions, bacterial
populations can increase up to between 100,000 and 10,000,000 colony forming units.514
464.
There is other evidence which demonstrates that significant bacterial multiplication can
occur on or in fruit. For example, photographic evidence shows ooze being produced on fruit
infected only a few weeks before harvest.515 Ooze contains very large numbers of bacteria and
therefore could not be produced unless significant multiplication had taken place. This lends
further support to the IRA Team’s conclusion.
465.
New Zealand also asserts that the IRA Team was wrong to conclude that E. amylovora
could multiply on decaying apples.516 However, New Zealand overlooks the data presented in
van der Zwet et al. (1990) which shows that apples in storage can develop fire blight.517 Data
presented in this paper shows that up to 15% of apples placed in storage develop symptoms of
fire blight. Significantly, fruit that had undergone a surface disinfection treatment exhibited a
higher level of symptoms than fruit which was not disinfected.
466.
Australia has referred above to the declaration made by Dr van der Zwet relating to
various experiments reported in van der Zwet et al. (1990) in the context of the Japan – Apples
dispute. In his declaration, Dr van der Zwet states that:
While the paper speculates that the development of blight in disinfested fruit
was presumably from endophytic bacteria, it is equally probable that the
disinfection procedure resulted in infection of the fruit by epiphytic (surface)
bacteria. The handling and disinfestation of the fruit could have resulted in
512
Exhibit AUS-2: Final IRA Report, Part B, p. 92.
Exhibit AUS-39: Thomson, S.V., Wagner, A.C. and Gouk, S.C. (1999) “Rapid epiphytic colonization
of apple flowers and the role of insects and rain” Acta Horticulturae 489, pp. 459-464; Exhibit AUS-40: Thomson,
S.V. (1986) “The role of the stigma in fire blight infections” Phytopathology 76(5), pp. 476-482; Exhibit NZ-5:
Thomson (2000).
514
Final IRA Report, Part B, p. 92.
515
Exhibit AUS-42: Longstroth, M. (2007) "Horticulture: Fire Blight Symptoms" Michigan State
University College of Agriculture and Natural Resources, 2002-2007.
516
New Zealand’s first written submission, para. 4.243.
517
Exhibit AUS-31: van der Zwet et al. (1990), p. 714.
513
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nicks or small bruises that allowed surface bacteria to infect the fruit and cause
blight symptoms to develop.518
467.
Although Dr van der Zwet goes on to state that the fruit were not tested for the presence
of endophytic bacteria, van der Zwet et al. (1990) does state that “[r]andom sampling from the
surface of blighted fruit in storage resulted in the recovery of E. amylovora”.519 He also states
that the disinfection process may have resulted “in nicks or small bruises that allowed surface
bacteria to infect the fruit and cause symptoms to develop”.520 The clear inference is that
symptoms could not develop from surface bacteria unless those bacteria had multiplied.
468.
Van der Zwet et al. (1990) clearly shows that damage, such as occurs in commercial
packing, predisposes apples to infection by E. amylovora and subsequent multiplication.
Significantly, this work provides independent support for the work of Sholberg et al. (1998)521
that showed fruit damage can lead to high levels of fire blight infestation of apple fruit.
Therefore surface infestation is a genuine concern in light of this evidence of multiplication.
469.
Van der Zwet et al. (1990) also shows a good correlation between disease incidence (rot)
in storage and the proximity of the apples to fire blight symptoms before harvest. For example,
Table 2522 in van der Zwet et al. (1990) shows that fruit within 3 cm of a blighted shoot showed
15% disease incidence after storage. Fruit within 120 cm of a blighted shoot showed 8% disease
incidence. Finally, fruit collected from a tree free of fire blight showed 1% disease incidence.
470.
There is also some experimental evidence that fire blight bacteria can rapidly multiply on
or in fruit. This evidence comes from the system frequently used to test for fire blight bacteria.
The test system is based on adding test solutions suspected of containing fire blight bacteria to
cut fruit surfaces. If fire blight bacteria are present they multiply rapidly and result in the
production of ooze containing very large bacterial numbers on the fruit surface.
471.
Thus, there is ample scientific evidence to show that New Zealand’s claims are
unfounded. The conclusion that rapid multiplication of bacteria in the environment on or in
apple fruit can occur is substantiated, and therefore is a credible part of the risk assessment.
518
Exhibit AUS-32: Declaration of Dr Tom van der Zwet, 16 July, 2002, p. 2 (emphasis added).
Exhibit AUS-31: van der Zwet et al. (1990), p. 713.
520
Exhibit AUS-32: Declaration of Dr Tom van der Zwet, 16 July, 2002, p. 2.
521
Exhibit AUS-34: Sholberg et al. (1998).
522
Exhibit AUS-31: van der Zwet et al. (1990), p.714.
519
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Australia – Apples (DS367)
vi.
472.
Australia’s First Written Submission of Australia
18 July 2008
Transmission of E. amylovora can occur
For disease to occur, E. amylovora must be transferred from apples to hosts. The IRA
Team identified two possible transmission modes: browsing insects and mechanical means.523
473.
New Zealand refers only to insects and claims that it has “[n]ever been demonstrated that
E. amylovora have been spread from apples to susceptible hosts by browsing insects”.524
Australia considers such an objection to be misplaced. Since the pathway being examined is
hypothetical, the IRA Team was not obliged to disregard a potential vector simply because it has
never been shown to “demonstrate” transmission of E. amylovora. The IRA Team were rightly
concerned with assessing the likelihood of this occurring in Australia’s circumstances.
474.
The evidence available to the IRA Team demonstrated that there was a likelihood, albeit
small, that insect-vectored transmission could occur. The Final IRA Report refers to studies
which show that 77 genera of arthropods that have been associated with fire blight spread.
Australia has at least 27 of these species or closely related species.525 In particular, the Final
IRA Report notes that bees are “major vectors” for the spread of E. amylovora. Bees typically
visit moisture sites such as ooze and visit flowers to obtain sugars.526 Clearly if E. amylovora
were present then the bees would be contaminated with it and may transfer it to flowers as they
search for nectar. The Final IRA Report indicates that transfer by this vector can occur. It states,
“[m]anaged hives of honeybees are used in contract pollination of apple orchards” and bees can
“fly up to two to four kilometres to forage”.527 New Zealand’s own evidence supports this
conclusion that bees have been shown to play a very significant role in the spread of fire blight
(Thomson, 2000).528
475.
Against this evidence, New Zealand relies on studies by Hale et al. (1996)529 and Taylor
et al. (2003a)530 that detected no spread of fire blight when apples contaminated with
523
Final IRA Report, Part B, p. 87-88.
New Zealand’s first written submission, para. 4.243.
525
Final IRA Report, Part B, p. 91.
526
The Final IRA Report shows a photo of bees visiting a rotting apple: Final IRA Report, Part B, p. 87.
527
Final IRA Report, Part B, p. 95.
528
Exhibit NZ-5: Thomson (2000), p. 19-20.
529
Exhibit NZ-27: Hale, CN, RK Taylor and RG Clark (1996) “Ecology and epidemiology of fire blight in
New Zealand” Acta Horticulturae 411, 79-85.
530
Exhibit NZ-28: Taylor et al. (2003a).
524
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E. amylovora were placed in orchards.531 Australia submits that there is a limit to what can be
concluded from these experiments. This is because the sample size in these experiments was
insufficient to detect rare events. In mathematical terms, 1,830 apples were tested between the
two studies combined.
Using standard statistical calculations of detection efficacy,532 the
likelihood of transmission would need to be approximately 0.0016 or greater for these
experiments to reliably detect transmission of E. amylovora.
Given that transmission rates of
around 10-6 on a per apple basis are significant, experiments that are only likely to detect events
around 1,700 times more frequent cannot provide a sound basis for New Zealand’s claims.
476.
In addition to insect-vectored spread, the IRA Team also identified mechanical processes
as a means of transmission of the disease. The Final IRA Report states:
Mechanical transmission of fire blight bacteria could also be possible. For
example, packing of New Zealand fruit in packing houses closely associated
with apple orchards could result in the exposure of workers and equipment to
fire blight bacteria. Initiation of disease could then occur by transfer of bacteria
to wounds caused by normal orchard operations such as pruning.533
Mechanical transmission of fire blight via tools, hands, machinery, etc. has been recognised as a
vector for a long time.534 New Zealand has not addressed this mode of transmission in their
submission. Accordingly, New Zealand fails to establish that the IRA Team’s conclusions on
the issue of mechanical transfer should be doubted.
vii.
477.
Conclusion on exposure
Australia submits that while the chain of events required for a successful exposure only
has a small chance of occurring, the scientific evidence demonstrates that such exposure events
can happen. Taking all the evidence into account, the IRA Team concluded that the exposure
value for an individual apple for all exposure group combinations was a uniform probability
range from zero to one in one million. This range was based on the IRA Team’s expert
judgment on both insect and mechanical transmission, explicitly acknowledging that “in some
circumstances the chances for exposure would be zero”.535
New Zealand’s first written submission, para. 4.243.
Exhibit AUS-30: ISPM No. 31.
533
Final IRA Report, Part B, p. 88.
534
Exhibit NZ-5: Thomson (2000), p. 17.
535
Final IRA Report, Part B, p. 90.
531
532
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Australia – Apples (DS367)
478.
Australia’s First Written Submission of Australia
18 July 2008
By contrast, the comparable estimate given by Roberts and Sawyer (2008) is 0.00001893
(1.893 x 10-5). This estimate is higher than the estimate given in the Final IRA Report, thereby
indicating that the IRA Team did not overestimate this likelihood or the risk.
479.
Regardless, New Zealand argues that the probability of exposure should be impugned
because “it is an event that almost certainly would not occur”.536 However, if the probability
ranges used by the IRA team are compared to equivalent qualitative descriptors,537 a range of
zero to one in one million is considered a “negligible” event, or an event that “would almost
certainly not occur”. New Zealand can therefore have no objection to the IRA Team’s judgment.
480.
Australia notes that under New Zealand’s methodology, a “negligible” event is, in some
cases, treated as potential opportunity to discontinue the risk assessment. However, the SPS
Agreement is not prescriptive as to methodology, and Australia is under no obligation to adopt
New Zealand’s method. Thus, having estimated a probability range with which New Zealand is
in apparent agreement, New Zealand cannot argue that the Final IRA Report need do more to
validly establish a probability of exposure.
viii.
481.
Establishment
New Zealand does not make any claims relating to fire blight disease establishment
under Article 5.1. Australia submits that New Zealand should not be permitted to make any such
claims at a later stage in these proceedings. New Zealand makes a only a few arguments under
Article 2.2 that Australia considers relevant to establishment of fire blight and thus addresses
them here.
482.
New Zealand contends that E. amylovora needs specific environmental conditions to
thrive, in particular, a mean temperature of greater than 15.6°C, a wetting event and humid
conditions (greater than 90%).538 Even accepting New Zealand’s claims on this point, the Final
IRA Report refers to studies that show that a number of major apple and pear growing areas in
Australia would have suitable conditions for the establishment of fire blight disease.539 In
New Zealand’s first written submission, para. 4.248.
Final IRA Report, Part B, Table 12, p. 43.
538
New Zealand’s first written submission, para. 4.17.
539
Final IRA Report, Part B, p. 91.
536
537
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addition, major cities such as Sydney have many fire blight host plants and have highly suitable
conditions for fire blight.
483.
New Zealand also claims that E. amylovora has short survival rates when exposed to
solar radiation or high humidity, and that E. amylovora is a poor epiphyte usually declining
rapidly on most flower parts or leaves within a few hours or days. 540 Australia agrees that
E. amylovora exhibits this behaviour under certain conditions. However, Australia has shown
above why E. amylovora survival is highly variable.541 New Zealand once again incorrectly
asserts that the Final IRA Report should be judged solely against its alternative account based on
selective scientific evidence.
ix.
484.
Spread
New Zealand does not make any claims relating to the spread of fire blight disease under
Article 5.1. Australia submits that New Zealand should not be permitted to make any such
claims at a later stage in these proceedings.
485.
To the extent that New Zealand makes arguments concerning possible modes of inter-
continental transmission of fire blight under Article 2.2, they are addressed above. Whether
apples provide a viable pathway for the introduction of fire blight is a question directed at the
nature of the risk scenario examined in the Final IRA Report. It does not relate to the specific
assessment of “spread” in the Final IRA Report. The spread analysis undertaken by the IRA
Team examined the ability of the pathogen to spread to other susceptible hosts, once the disease
has established on a host plant in Australia.542 Taking this into account, it becomes clear that
New Zealand has made no argument at all in relation to the spread analysis by the IRA Team.
(d)
The IRA Team’s assessment of the probability of entry, establishment and
spread should not be disturbed
486.
The IRA Team used the @RISK model to run two “apple utilisation” scenarios. The first
assumed that the majority of apples would be imported in bulk and packed in packing houses
New Zealand’s first written submission, para. 4.20.
See, for example, the discussion under Importation step 3 and the discussion concerning the ability of
E. amylovora to multiply.
542
Final IRA Report, Part B, p. 30-31. The partial probability of spread considers the expansion of the
geographical distribution of the pest.
540
541
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associated with orchards. The second scenario assumed that almost all imported apples would be
packed in a form that allows direct distribution to retailers. This scenario reflects New Zealand’s
claim that most of its exports will be “retail ready”. The results under both scenarios were
similar,543 reflecting the fact that the partial probability calculation of establishment and spread is
dominated by apples discarded by consumers. Under the first scenario, the probability of entry,
establishment and spread was represented by a probability range with 9.1 x 10-3 (0.0091%) as the
5th percentile value, 4.5 x 10-2 (4.5%) as the median value, and 0.18 (18%) as the 95th percentile
value.
Under the second scenario, the probability of entry, establishment and spread was
represented by a probability range with 8.7 x 10-3 (0.0087%) as the 5th percentile value, 4.4 x10-2
(4.4%) as the median value, and 0.18 (18%) as the 95th percentile value.
487.
New Zealand disagrees with these calculations for two reasons. First, New Zealand
claims that the probability of entry, establishment and spread is higher than the estimate provided
in Roberts and Sawyer (2008). Australia has already addressed this issue above and affirms that
the equivalent value estimated by Roberts and Sawyer (2008) is unsound. Secondly, New
Zealand refers to the findings in Japan – Apples and claims:
Nowhere does the IRA attempt to justify or explain why its assessment of the
likelihood of transmission of fire blight on an annual basis is significantly
higher than the Panel’s assessment in Japan – Apples of the likelihood of the
same event from all trade in apples.544
New Zealand attributes this “failing” to the use of the semi-quantitative method.545
It claims
that application of this method “discounts [the] finding [in Japan – Apples] and produces a
distorted estimate of risk”.546
488.
Australia is not obliged to justify why its risk assessment arrives at a different conclusion
on the likelihood of entry, establishment and spread than the findings in Japan – Apples. Those
findings are not a risk assessment or scientific facts that the Final IRA Report can be measured
against. However, even if the conclusions of Japan – Apples are treated as scientific facts,
Australia submits that its differing assessment of probability is more than adequately explained
by the differences in the treatment of critical issues and the circumstances. One significant
factor was volume of trade.
543
Final IRA Report, Part B, Table 21, p. 97.
New Zealand’s first written submission, para. 4.171.
545
New Zealand’s first written submission, para. 4.170.
546
New Zealand’s first written submission, para. 4.171.
544
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Australia – Apples (DS367)
489.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team first calculated the probability of entry, establishment and spread on a per
apple basis. However, probabilities attached to a single apple are not meaningful to a risk
assessment directed at evaluating risk where apples are traded in commercial volumes.
Therefore, the IRA Team combined its result on the per apple probability of entry, establishment
and spread with the volume of trade.547 In this case, the model generated a “very low”, but
identifiable, probability of entry, establishment and spread under assumptions that as closely as
possible approximated realistic replication. This demonstrates that low probabilities for disease
transmission on a per apple basis can be highly significant when the volume of potential trade is
taken into account. New Zealand concedes as much by making significant arguments about how
the volume of trade affects the calculation of risk.548
490.
The IRA Team’s explicit analysis of the volume of trade is a material point of difference
from Japan – Apples. Although New Zealand asserts that Japan – Apples “found that the risk of
fire blight being transmitted through trade in any number of mature, symptomless apples was
‘negligible’”549, there is nothing in the relevant reports to support this unsubstantiated claim.
The finding that New Zealand relies on550 does not refer to “any number of apples”. It is silent
on the volume of trade. Moreover, it is clear that the finding in Japan – Apples was based on
“information made available” and was therefore specific to the facts of that dispute.
491.
Accordingly, Australia submits that New Zealand’s argument is fundamentally flawed.
The Panel should not accept that a comparison between the findings in Japan – Apples and the
present case is a comparison of “apples and apples”, rather it is a comparison of “apples and
oranges”.
492.
Australia’s arguments on probability of entry, establishment and spread demonstrate that
New Zealand’s claims are based on a selective account of the scientific information, spurious or
irrelevant claims, a poor understanding of the methodology used in the Final IRA Report and a
poor understanding of the SPS Agreement.
Australia submits that they are without merit.
547
Final IRA Report, Part B, p. 17-18.
New Zealand’s first written submission, paras. 4.194–4.203.
549
New Zealand’s first written submission, para. 4.170. (original emphasis)
550
Panel Report, Japan – Apples, para. 8.176: “On the basis of the information made available to the Panel,
we conclude that there is not sufficient scientific evidence that apple fruit are likely to serve as a pathway for the
entry, establishment or spread of fire blight within Japan.”
548
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18 July 2008
Accordingly, the Panel should reject New Zealand’s claims in relation to the assessment of entry,
establishment and spread in total.
(e)
The IRA Team’s analysis of the potential consequences is objective and
credible
i.
493.
Fire blight is a destructive disease
Fire blight is one of the most serious diseases of pome fruit trees in the world (Schroth et
al. 1974).551
It has a direct impact on production by killing branches and damaging the
productive capacity of fruiting wood for future crops. Fire blight may kill trees or damage trees
so seriously that they have to be destroyed.552 If the trees are not replaced, there is a permanent
loss of production. If they are replaced, costs of the disease include replanting and the loss of
yield over the time it takes the new trees to reach bearing age and, later, full commercial yield.
494.
Control action in orchards against fire blight would be costly, requiring expenditure on
chemical inputs, pruning and other aspects of plant hygiene. Indirect costs include ongoing
surveillance and, if an outbreak were to occur, the costs of attempting eradication, as well as
flow-on losses to other industries.
495.
The cost and impact of eradication have been starkly illustrated recently in southern
Oregon in the United States where an outbreak of fire blight in pear orchards has required
orchardists to carry out an extensive programme of pruning and burning infected branches.
Australia provides, as an exhibit, an article dated 9 July 2008 from the Mail Tribune reporting in
detail on the response of orchardists and the broader impact on the community.553
ii.
The IRA Team comprehensively addressed relevant factors and evidence
in evaluating consequences
496.
Considering the wide range of relevant factors and the evidence available on the
experience of other countries in dealing with fire blight, the IRA Team rated the biological and
Exhibit AUS-41: Schroth MN, Thomson SV, Hildebrand DC and Moller WJ (1974) “Epidemiology
and control of fire blight”, Annual Review of Phytopathology 12, pp389-412; Final IRA Report, Part B, p. 98
552
Exhibit AUS-42: Longstroth, M. (2007) "Horticulture: Fire Blight Symptoms" Michigan State
University College of Agriculture and Natural Resources, 2002-2007.
553
Exhibit AUS-43: Burke A, “Healing flame”, Mail Tribune, Thursday, 10 July, 2008.
551
167
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
economic consequences of fire blight as “high”.554 New Zealand argues that this conclusion is
based on “selectively chosen evidence” and “assumptions that have no basis in scientific
evidence or fact”.555 However, New Zealand offers no evidence that any of the conclusions
stated in the Final IRA Report are flawed. Indeed, its attempt to discredit the consequence
assessment suffers from those deficiencies that it claims affected the work of the IRA Team.
iii.
New Zealand relies on selective examples to downplay potential
production losses
497.
New Zealand argues that the IRA Team’s estimates for production loss from fire blight
incursions were exaggerated.556 However, instead of engaging with the substantial body of
research reviewed by the IRA Team, New Zealand offers only a few, selective examples which,
taken in isolation, misrepresent the potential impact of the disease.
iv.
The IRA Team took into account reports from New Zealand and other
countries, including the United States
498.
The IRA Team took into account reported losses from fire blight outbreaks in New
Zealand and other countries, in particular, the United States. As referenced in the Final IRA
Report,557 for example, Longstroth (2001) estimates that an outbreak of fire blight in south-west
Michigan in 2000 resulted in a US$10 million production loss in that season, with estimated
cumulative losses valued at nearly US$36 million in the five years it would take for yields to
recover.558 The Final IRA Report559 cites Vanneste (2000) as referring to NZ$10 million in
losses from the fire blight outbreak in Hawke’s Bay in New Zealand in 1998.560 Vanneste
(2000) also refers to an estimate of losses because of fire blight in the north-west of the United
554
Final IRA Report, Part B, p. 104.
New Zealand’s first written submission, para. 4.254.
556
New Zealand’s first written submission, para. 4.255.
557
Final IRA Report, Part B, pp. 98-99.
558
Exhibit AUS-44: Longstroth M. (2001) “The 2000 fire blight epidemic in southwest Michigan apple
orchards”, The Compact Fruit Tree 34 (1), pp. 16-19, p. 16.
559
Final IRA Report, Part B, p. 98.
560
Exhibit AUS-45: Vanneste, J.L. (2000) “What is fire blight? Who is Erwinia amylovora? How to
control it?” In: Vanneste JL (Ed) Fire blight: The disease and its causative agent, Erwinia amylovora, CABI
Publishing, CAB International, pp. 1-6, p.1.
555
168
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
States as US$68 million in 1998.561 Norelli et al. (2003) estimates annual losses because of fire
blight and costs of control in the United States at over US$100 million.562
v.
499.
Significant numbers of trees can be lost in a fire blight outbreak
There were heavy tree losses in the outbreak of fire blight which occurred in south-west
Michigan in 2000. An estimated 377,000 trees were lost in five of the counties563 most affected
by the outbreak.564 The United States 1997 Census of Agriculture reported that between them
the five counties had 19,402 acres under apple trees.565 The United States 2002 Census of
Agriculture revealed that the number of acres had fallen to 12,932: a decline of 6,470 acres.566
vi.
500.
New Zealand ignores the range of reports considered by the IRA Team
The IRA Team’s consideration of the losses suffered from fire blight outbreaks in other
countries demonstrates the hollowness of New Zealand’s statement that the IRA Team’s rating
of overall consequences as “high” has “no basis in scientific evidence or fact”.567 New Zealand
ignores the reports cited above. It concentrates on only one paper of those taken into account by
the IRA Team, Roberts (1991)568, which reported that a fire blight outbreak in Australia could
cause a 50% production loss for pears and a 20% loss for apples.569
501.
Roberts (1991) assessed long-term weather patterns in Australia’s apple and pear
growing regions using a predictive model (principally Billing’s model) to establish whether the
combination of temperature and rainfall in these regions would be conducive to fire blight
561
Exhibit AUS-45: Vanneste (2000), p. 1.
Exhibit AUS-46: Norelli JL, Jones AL and Aldwinckle HS (2003) “Fire blight management in the
twenty-first century; using new technologies that enhance host resistance in apple”, Plant Disease 87(7), pp. 756765, p. 757.
563
The counties are Allegan, Berrien, Cass, Kalamazoo and Van Buren.
564
Exhibit AUS-44: Longstroth (2001), p. 17.
565
Exhibit AUS-47: United States Department of Agriculture, 1997 Census of Agriculture, Michigan State
and County Data, Volume 1, Geographic Area Series, Part 22, Table 31, p. 495:
http://usda.mannlib.cornell.edu/reports/census/ac97ami.pdf
566
Exhibit AUS-48:.United States Department of Agriculture, 2002 Census of Agriculture, Michigan State
and County Data, Volume 1, Geographic Area Series, Part 22, Table 31, p. 467:
http://www.nass.usda.gov/census/census02/volume1/mi/MIVolume104.pdf
567
New Zealand’s first written submission, para. 4.254.
568
Exhibit NZ-55: Roberts, WP (1991) “Using weather records and available models to predict the
severity of fireblight should it enter and establish in Australia” EPPO Bulletin 21, pp. 623-631.
569
New Zealand’s first written submission, para. 4.255.
562
169
Australia – Apples (DS367)
outbreaks.
Australia’s First Written Submission of Australia
18 July 2008
Roberts (1991) acknowledged that fire blight “severity is highly variable”.570
However, applying the predictive model, Roberts (1991) identified that certain regions had
severe ratings from season to season.571 Others had a mixture of severe and moderate ratings and
in one case there were low ratings as well. While New Zealand attacks Roberts (1991) for its
statement about production losses, it offers no criticism of the methodology used or its
conclusion about the susceptibility of Australia’s apple and pear growing regions to fire blight.
502.
The IRA Team clearly did not only take Roberts (1991) into account in evaluating
potential production loss. Longstroth (2001) reported that the fire blight outbreak in Michigan
would likely result in yield losses in the 20%-70% range for most apple varieties.572 Longstroth
(2001) provided an estimated production loss for the region in 2000 of 2.7 million bushels
(approx. 52,000 tonnes573) against an average annual production of 4.5 million (approx. 86,000
tonnes) – 7 million bushels (134,000 tonnes).574 2.7 million bushels represent 60% of 4.5 million
bushels and 38% of 7 million bushels.
503.
The following table sets out Australian apple production (in tonnes) by State in 2006-07:
Table 5: Australian Apple Production 2006-07575
Australia
Production (t)
Total
NSW
Vic
Qld
SA
WA
Tas
270,476
37,384
115,584
29,521
27,529
31,932
28,523
It can be seen from this table that the production loss of more than 50,000 tonnes suffered in
south-west Michigan exceeds the total annual production in five of six Australian States.
504.
The IRA Team also had before it the study in Wittwer et al. (2004) which assessed two
scenarios for a fire blight outbreak in the Goulburn Valley in Victoria, which produces most of
570
Exhibit NZ-55: Roberts (1991), p. 627.
Exhibit NZ-55: Roberts (1991), p. 628.
572
Exhibit AUS-44: Longstroth (2001), p. 18.
573
Using the 1 bushel = 19.1 kgs conversion rate provided in Exhibit AUS-X: Longstroth (2001), p. 16.
574
Exhibit AUS-44: Longstroth (2001), p. 16.
575
Source: Australian Bureau of Statistics “2006-07 Agricultural Commodities”, 7121.0, 28 May 2008, p.
18 (Extract):
http://www.ausstats.abs.gov.au/Ausstats/subscriber.nsf/0/BC368442A5431DDECA2574560014CA50/$File/71210_
2006-07.pdf. (accessed 9 July 2008)
571
170
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Australia’s pears and significant proportion of its apples.576 One scenario assesses a 50% decline
in pear production and a 20% decline in apple production because of a fire blight outbreak. The
other scenario assesses a 25% decline in pear production and a 10% decline in apple production.
505.
In the latter scenario, it is assumed that the outbreak is confined to an area of only 450
hectares on 20 orchards.
It is also assumed that the affected orchards gradually recover
production over time. Wittwer et al. (2004) estimates significant regional and national economic
impacts of the outbreak with the net present value of the loss amounting to A$260 million.577
These costs include additional management costs – such as chemicals, pruning and replanting –
along with the net flow on costs to processing and other related sectors.
vii.
New Zealand assumes that its own experience of fire blight will be
replicated in Australia
506.
Leveraging off its attack on Roberts (1991), New Zealand seeks to build a contrasting
case on the basis of information taken almost exclusively from its own experience. First, it
suggests that the IRA Team erred by treating the impact of fire blight as severe every year. 578
New Zealand does not refer to any particular element of the IRA Team’s analysis. It simply
cites the pages of the Final IRA Report recording the analysis. 579 This assertion cannot be
supported when weighed against the comprehensive analysis conducted by the IRA Team.
507.
Based on its own experience, New Zealand asserts that serious damage from fire blight
tends to occur once every ten years.580 Production losses are described as “inconsequential” in
“non-outbreak years”581; a view which New Zealand claims is also supported by United States
experience.582 Clearly, New Zealand was not including the severe fire blight outbreak in southwest Michigan in its reference to the experience in the United States, as the following extract
from Longstroth (1991) shows:
Exhibit AUS-49: Wittwer G, McKirdy S. and Wilson R. (2004) “Dynamic CGE analysis of the
economic effects of a fireblight outbreak in Goulburn Valley”, Monash University/Plant Health Australia, p. 3.
577
Exhibit AUS-X: Wittwer et al. (2004), p. 3.
578
New Zealand’s first written submission, para. 4.256.
579
See: footnote 275 in New Zealand’s first written submission which references the Final IRA Report,
Part B, pp. 98-104.
580
New Zealand’s first written submission, para. 4.256.
581
New Zealand’s first written submission, para. 4.256.
582
New Zealand’s first written submission, para. 4.259. Australia notes, however, that New Zealand does
not provide any supporting evidence of the United States experience it purports to rely on.
576
171
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
The southwest Michigan apple industry will be severely affected for at least
the next five years. Large portions of this year’s crop have been lost due to the
death of branches and trees that supported the fruit. Many young orchards will
need to be replanted. About 5 years will be required for these orchards to
return to significant production. In mature orchards, 3 to 5 years will be
required to grow new branches and restore production.583
Australia submits that there is nothing “inconsequential” about this impact on production.
viii.
508.
New Zealand discounts the Hawke’s Bay fire blight outbreak in 1998
New Zealand discounts the impact of the major fire blight outbreak in Hawke’s Bay in
1998. Citing Vanneste (2000)584, the IRA Team took into account an estimated loss of at least
NZ$10 million during 1998 resulting from this outbreak.585 The author cites the Hawke’s Bay
outbreak as an example of how fire blight “has caused serious losses around the world”.586 This
view of the Hawke’s Bay outbreak stands in stark contrast to New Zealand’s assertion that the
impact at the district or regional level was “minor even in a severe outbreak year”.587
509.
New Zealand attempts to minimise the importance of the loss of NZ$10 million in the
Hawke’s Bay region by claiming that it corresponded to only 2.8% of New Zealand’s pipfruit
exports and 5.9% of total Hawke’s Bay pipfruit exports.588
This is misleading because it
compares the net cost of the outbreak with the gross pipfruit export revenue for New Zealand
and Hawke’s Bay.
510.
New Zealand refers to 2.8% of New Zealand’s pipfruit exports as being “7.1-fold lower
than the 20% loss estimate used in Australian studies”.589
Putting aside the flaw in New
Zealand’s figures identified above, this comparison represents an attempt by New Zealand to
suggest that the only yardstick by which the consequences of fire blight can be measured is its
own. By making the comparison, New Zealand also implies that the IRA Team only took into
account the “20% loss estimate”, contrary to the IRA Team’s comprehensive review.
583
Exhibit AUS-44: Longstroth (2001), p. 18.
Exhibit AUS-45: Vanneste (2000).
585
Final IRA Report, Part B, p. 98.
586
Exhibit AUS-45: Vanneste (2000), p. 1.
587
New Zealand’s first written submission, para. 4.261.
588
New Zealand’s first written submission, para. 4.261.
589
New Zealand’s first written submission, para. 4.261.
584
172
Australia – Apples (DS367)
511.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand also does not quantify the consequence of the NZ$10 million loss in terms
of lost production in subsequent years from trees damaged or killed in the outbreak. Australia
submits that, if New Zealand wishes to assert that such production losses were
“inconsequential”590, it should produce the evidence to support that assertion.
512.
New Zealand attributes, in part, the claimed reduction in the severity in fire blight in its
orchards to the presence of other bacteria which “aggressively compete with E. amylovora for
nutrients and space on a susceptible host”.591 Without offering any scientific evidence, New
Zealand claims that the bacteria would probably have a “similar impact on E. amylovora in
Australia”.592
The IRA Team noted the potential efficacy of biological control agents.593
However, biological control agents for E. amylovora are not registered for use in Australia. This
is yet another example of New Zealand applying only the yardstick of its experience to the
circumstances Australia would confront in dealing with fire blight. Looking at another yardstick,
Norelli et al. (2003) refers to annual losses to fire blight and costs of control in the United States
as amounting to over US$100 million per year.594
ix.
513.
New Zealand downplays control, eradication and tree replacement costs
New Zealand disputes the IRA Team’s assessment regarding indirect costs of eradication
and surveillance monitoring for fire blight,595 making arguments in relation to only three points
and without engaging with the IRA Team’s full analysis.
514.
First, New Zealand makes arguments in relation to the fire blight incursion in the Royal
Botanic Gardens Melbourne in 1997.596 However, the point that New Zealand seeks to make is
unclear. It claims that approximately two thirds (68%) of the estimated revenue loss due to the
outbreak, reported in Rodoni et al. (2006)597, was due to “unnecessary” restrictions on the
movement of apple fruit because of “erroneous assumptions about pathways of fire blight
New Zealand’s first written submission, para. 4.260.
New Zealand’s first written submission, para. 4.257.
592
New Zealand’s first written submission, para. 4.257.
593
Final IRA Report, Part B, p.101.
594
Exhibit AUS-46: Norelli et al. (2003), p. 757.
595
New Zealand’s first written submission, para. 4.262.
596
New Zealand’s first written submission, para. 4.262.
597
Exhibit NZ-59: Rodoni, BC, PR Merriman, SJ McKirdy and G Wittwer (2006), “Costs associated with
fire blight incursion management and predicted costs of future incursions” Acta Horticulturae 704, pp. 55 – 61.
590
591
173
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
transmission”.598 Irrespective of New Zealand’s claims, these were actual losses due to the
outbreak. New Zealand also does not explain how the composition of total revenue loss actually
affects the reliability of the A$2.2 million expended on surveys, eradication programs,
diagnostics and publicity, which was considered by the IRA Team in its assessment of indirect
impacts of fire blight on control and eradication.
515.
Secondly, New Zealand claims that the IRA Team ignored New Zealand experience in
estimating the cost of compensating growers and replanting.599 New Zealand refers to its own
experience and claims that only orchards with young pear trees of fire blight-prone varieties
might experience up to 20% tree mortality. The average pear tree loss across a district is argued
to be closer to 5%.600 New Zealand provides no support for either of these assertions.
516.
These unsubstantiated claims may be contrasted to the reports from other countries on the
mortality effects of fire blight outbreaks referred to in the Final IRA Report. For example, the
fire blight outbreak in Michigan in 2000 was reported by Longstroth (2001) to involve an
estimated cost of tree loss of US$9 million.601 There have also been reports of the loss of up to
500,000 trees in Italy as a result of fire blight outbreaks.602
517.
Even leaving the experience of other countries to one side, an average fire blight outbreak
mortality loss of 5% for pears, as suggested by the New Zealand experience, 603 would translate
into an estimated loss of around 86,000 pear trees in the main Australian pear production region
in the Goulburn Valley in the State of Victoria. The impact could, however, be even greater than
the average New Zealand experience as pear trees in this area could be more susceptible to fire
blight given differences in temperature at flowering time in New Zealand and the Goulburn
Valley. In addition to the initial production loss, there would be the cost of replanting and
ongoing yield losses until new trees began to bear fruit, as well as management and surveillance
costs. Australia does not accept that losses of this order should be characterised as “minor”.
New Zealand’s first written submission, para. 4.262.
New Zealand’s first written submission, para. 4.263.
600
New Zealand’s first written submission, para. 4.263.
601
Final IRA Report, Part B, pp. 98-99; Exhibit AUS-44: Longstroth (2001), p. 18.
602
Exhibit AUS-45: Vanneste (2000), p. 1.
603
New Zealand’s first written submission, para. 4.263.
598
599
174
Australia – Apples (DS367)
518.
Australia’s First Written Submission of Australia
18 July 2008
Yet again, New Zealand fails to take into account the fact that other countries can have
different experiences of fire blight to its own. It ignores the fact that the size of the pear fruit
industry in New Zealand is only around one tenth of the size of the Australian industry. New
Zealand has provided no basis for calling into question the IRA Team’s judgment on this point.
Therefore, the IRA Team’s judgment should not be displaced by New Zealand’s experience.
x.
519.
New Zealand overplays its international trade experience
Finally, New Zealand argues that none of the 65 countries it exports apples to constrain
access due to the presence of fire blight.604 Accordingly, it claims that the IRA Team had no
basis to conclude that Australian exports of apples or pears would be constrained in any way if
fire blight became established in Australia.605
520.
Significantly, Australia has experienced additional measures and delays in access to some
North Asian markets as a result of the detection of fire blight in the Royal Botanic Gardens
Melbourne incident. Despite New Zealand’s claim that other countries do not constrain access
for its apples, Australia provides the following examples to the contrary.606
521.
The Argentinian authorities require a declaration that the fruit has been treated by
immersion for one minute in 100ppm of chlorine and found free from E. amylovora.607 The
Chilean authorities require a declaration that the consignment has been treated, under MAFNZ
supervision, with a chlorine solution (100 ppm of chlorine for one minute) for E. amylovora
control.608 The Indian authorities require a declaration that fruit is free from E. amylovora.609
The Chinese Taipei authorities require that phytosanitary certificates issued by the New Zealand
New Zealand’s first written submission, para. 4.264.
New Zealand’s first written submission, para. 4.264.
606
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register.
Available at http://www.biosecurity.govt.nz/commercial-exports/plant-exports/icpr-register (last
accessed 11 July 2008)
607
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register: Argentina, p. 12.. Available at http://www.biosecurity.govt.nz/files/regs/stds/icprs/argentina.pdf (last
accessed 11 July 2008)
608
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register: Chile, p. 19. Available at http://www.biosecurity.govt.nz/files/regs/stds/icprs/chile.pdf (last accessed 11
July 2008)
609
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register: India, p. 16. Available at http://www.biosecurity.govt.nz/files/regs/stds/icprs/india.pdf (last accessed 11
July 2008)
604
605
175
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
authorities, which accompany shipments, must include a declaration that, “Apples are thoroughly
inspected and found free from Erwinia amylovora.”610
xi.
522.
Summary on consequences
Australia submits, on the basis of the arguments set out above, that New Zealand’s claim
that the IRA Team failed to evaluate the potential biological and economic consequences of fire
blight in Australia is unfounded. As Australia has shown, New Zealand has systematically failed
to engage with the substantial body of literature and evidence considered by the IRA Team.
Instead, it has sought to build an alternate case based almost entirely on limited and
misrepresented examples and its own experience.
New Zealand ignores the fact that the
circumstances of New Zealand and Australia are quite different, and consequently, any impacts
of fire blight cannot be expected to be experienced in the same way.
523.
New Zealand’s burden of proof cannot be discharged merely by offering what is, in
reality, an assumption that New Zealand’s experience of fire blight will be replicated in
Australia. Australia submits that New Zealand failed to identify any flaws in the IRA Team’s
conclusions on consequences, let alone any flaws serious enough to prevent the Panel from
having “reasonable confidence” in the risk assessment.
(f)
Conclusion: New Zealand fails to discredit the IRA Team’s assessment on
fire blight
524.
New Zealand has offered an alternative account of risk based on selective and often
misleading evidence in the hope that this flawed and unbalanced assessment can substitute a
proper discharge of its burden of proof.
New Zealand did not engage with the very
comprehensive evidence reviewed by the IRA Team, instead deferring to the reasoning of the
panel in Japan – Apples as if this report could somehow make up for its lack of argument. In so
doing, it failed to demonstrate any flaws in the Final IRA Report, let alone flaws that were “so
serious” that it should prevent the Panel from having reasonable confidence in the evaluation
made. New Zealand’s attempts to discredit the Final IRA Report have failed.
610
Exhibit AUS-18: Biosecurity New Zealand, Importing Countries’ Phytosanitary Requirements
Register: Taiwan, p. 28. Available at http://www.biosecurity.govt.nz/files/regs/stds/icprs/taiwan.pdf (last accessed
11 July 2008)
176
Australia – Apples (DS367)
525.
Australia’s First Written Submission of Australia
18 July 2008
In any event, Australia has demonstrated that the IRA Team properly evaluated risk and
applied its expert judgment rigorously to arrive at an objective and credible assessment for fire
blight. Accordingly, the risk assessment is consistent with Article 5.1 of the SPS Agreement.
4.
European canker
(a)
526.
The IRA Team’s analysis of the probability of entry is objective and credible
The IRA Team’s comprehensive and transparent analysis of the probability of
importation for European canker is detailed in the Final IRA Report.611 This discussion includes
references to the available scientific evidence supporting the likelihood assessment for each
importation step. Accordingly, contrary to New Zealand’s assertion,612 it is clear that there is an
objective or rational relationship between the scientific evidence and the probability value that is
chosen at each step of the importation scenario.
527.
The Final IRA Report notes that “[w]hen these likelihoods were inserted into the risk
simulation model [@RISK], the probability of importation of [Neonectria] galligena was
estimated as being 6.8 x 10–5 (mean), 3.5 x 10–5 (5th percentile) and 10–4 (95th percentile).
Therefore, the infestation/infection rate for N. galligena was estimated to be 0.0068% (mean) of
the total proposed number of apples imported from New Zealand annually.”613
528.
Australia will now address in turn New Zealand’s arguments in relation to each of the
eight importation steps for N. galligena. New Zealand does not contest Importation step 1614 or
Importation step 8615 and has limited its challenge to Importation steps 2-7. Australia submits
that New Zealand should not be permitted to expand its claims beyond these issues at a later
stage in these proceedings.
611
Final IRA Report, Part B, pp. 118-128.
New Zealand’s first written submission, para. 4.267.
613
Final IRA Report, Part B, p. 128.
614
New Zealand’s first written submission, para. 4.269.
615
New Zealand’s first written submission, para. 4.298.
612
177
Australia – Apples (DS367)
i.
529.
Australia’s First Written Submission of Australia
18 July 2008
Importation step 2
Importation step 2 deals with the likelihood that picked fruit is infested/infected with N.
galligena. New Zealand asserts that:
The IRA assesses the likelihood of a mature apple being infested or infected
with N. galligena as a uniform distribution with a minimum value of 10-6 and a
maximum value of 10-3. But the IRA fails to cite any scientific or other
evidence that supports this proposition.616
530.
New Zealand’s assertion is wrong as it ignores the Final IRA Report’s extensive
discussion on Importation step 2 with numerous references to relevant scientific literature.617
New Zealand relies on arguments in relation to: (a) climate analysis; (b) minimal literature on
fruit rot; (c) latent infection; and (d) Braithwaite (1996).
a.
531.
New Zealand’s climate analysis is too narrow
New Zealand asserts, on the basis of its own selective climate analysis (Beresford and
Kim, 2008),618 that “in New Zealand, no region, not even Auckland, has weather conditions
favourable to European canker in the summer, leading to extremely low incidence of fruit
infection caused by N. galligena.”619 However, Australia has conducted its own modelling that
highlights the limitations of New Zealand’s analysis (Annex 2).
532.
It is well accepted in plant pathology that disease infection is based on three key factors:
the pathogen, the host and the environment. However, New Zealand’s climate analysis is
focused solely on the environmental criteria.
The environmental criteria (rainfall and
temperature) used in New Zealand’s climate analysis620 are based on a study in California by
Dubin and English (1975) and an analysis of disease incidence in Chile reported in Lolas and
Latorre (1996). The Dubin and English (1975) study correctly used all three key factors to
predict disease infection: the pathogen (conidial production), the host (leaf fall, availability of
leaf scars as infection points), and the environment (temperature and rain).621
New Zealand’s first written submission, para. 4.270 (emphasis added); also, para. 4.275.
Final IRA Report, Part B, pp. 121-123.
618
New Zealand’s first written submission, Annex 3, pp. 218-240.
619
New Zealand’s first written submission, para. 4.271; also, paras. 4.53, 4.55, 4.56, 4.57 & 4.61
(Article 2.2).
620
New Zealand’s first written submission, Annex 3, pp. 220, 226, 228-232.
621
Exhibit NZ-12: Dubin and English (1975): pp. 543-544.
616
617
178
Australia – Apples (DS367)
533.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand’s climate analysis622 uses two environmental characteristics, rainfall on
more than 30% of days per month and temperature between 11-16ºC for more than eight hours
per day.623 However, these requirements are not fully supported by other literature and high
infections can occur at other values of these parameters.624 Further, in Figure 1 of Beresford and
Kim625, the number of hours a day between 11-16 ºC was not significantly different for May
1993 and May 1995, the difference in infection rates between the two years being largely
explained by the differences in rainfall.
Accordingly, there is no clear justification for
concluding that a temperature range of 11-16 ºC is needed for 8 hours a day. These observations
indicate that attempting to predict infection and establishment of N. galligena using
environmental parameters alone, without adequate testing, can be too simplistic. In fact, a
review of New Zealand’s climate analysis, undertaken by Australia’s Bureau of Rural
Sciences,626 concludes that the climatic parameters used by New Zealand are too restrictive
(Annex 2).
534.
In Australia’s view, New Zealand’s narrow approach can lead to incorrect predictions.
New Zealand’s climate analysis predicts that the climatic conditions in New Zealand are
unsuitable for European canker development during summer (December to February) leading to
“a lack of European canker fruit infection”.627 Data provided by New Zealand and referred to in
the Final IRA Report demonstrates that of 3,300 rotted fruit tested between 1999 and 2005,
seven (0.21%) collected from Waikato were found to be infected with N. galligena in summer.628
This data confirms earlier reports of occasional detection of European canker fruit rot in New
Zealand in summer.629 This example usefully illustrates the unreliability of the predictions from
New Zealand’s climate analysis.
New Zealand’s first written submission, Annex 3, pp. 218-240.
New Zealand’s first written submission, Annex 3, p. 222; also, paras. 4.55, 4.58 & 4.90 (Article 2.2).
624
Exhibit NZ-12: Dubin and English (1975); Exhibit AUS-50: Latorre, B.A., Rioja, M.E., Lillo, C. and
Muñoz, M. (2002) "The effect of temperature and wetness duration on infection and a warning system for European
canker (Nectria galligena) of apple in Chile" Crop Protection 21 (4), pp285-291; Exhibit NZ-7: Grove (1990).
625
New Zealand’s first written submission, Annex 3, pp. 226
626
A bureau within the Australian Government’s Department of Agriculture Fisheries and Forestry.
627
New Zealand’s first written submission, Annex 3, p. 222.
628
Exhibit AUS-51: Ministry of Agriculture and Forestry, New Zealand (2005a) Correspondence sent
from MAFNZ to BA, 16th May 2005. See Final IRA Report, Part B, p. 122.
629
Exhibit AUS-52: Atkinson, J.D. (1971) "Bacterial diseases of pip fruit" in: Diseases of tree fruits in
New Zealand. New Zealand Department of Scientific and Industrial Research, Information Series 81, pp102-106;
and Exhibit AUS-53: Brook, P.J. and Bailey, F.L. (1965) "Control of European canker" The Orchardist of New
Zealand 38, pp117-118; Final IRA Report, Part B, pp. 121-122.
622
623
179
Australia – Apples (DS367)
535.
Australia’s First Written Submission of Australia
18 July 2008
Finally, New Zealand claims that “there have been no reported incidences of fruit
infections outside of the Auckland/Waikato region in the past 15 years”.630 However, it is
unclear whether some of the European canker fruit rot occurrences recorded in New Zealand
Plant Protection Centre records631 were from areas other than those two areas. In fact, the IRA
Team requested this information from the relevant New Zealand authorities but it was not
provided.
b.
536.
There is literature on European canker fruit rot in New Zealand
New Zealand asserts that “there is very little literature on fruit rot in New Zealand”. 632
However, the Final IRA Report identifies four relevant studies in relation to fruit rot caused by
N. galligena in New Zealand.633 New Zealand first written submission is noticeably silent on
this point. Instead, New Zealand selectively refers to AQIS interception data cited in the Final
IRA Report634 erroneously claiming that this is “the only relevant information that is cited in the
IRA”.635 When interpreting this data the IRA Team was conscious of the fact that latent
infection will often only express itself after it has been stored for a long period. In any event, the
small sample size (450 apples) of this AQIS interception data meant that it was given little
weight by the IRA Team in its consideration of Importation step 2.
537.
Further, Australia notes that, in the context of its arguments under Article 5.5, New
Zealand draws an analogy between the fruit rot by brown rot and N. galligena,636 implicitly
acknowledging that European canker does cause fruit rots.
c.
538.
Latent infection of apples occur in New Zealand
New Zealand asserts that:
… the IRA presents no data or evidence to show that latent infections actually
occur in New Zealand. Instead, the IRA relies primarily on scientific research
about latent fruit rots in the United Kingdom and Northern Europe, where
New Zealand’s first written submission, para. 4.271; Annex 3, p. 219.
Exhibit NZ -34: Braithwaite (1996).
632
New Zealand’s first written submission, para. 4.271; also, paras. 4.272; 4.59 (Article 2.2).
633
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a): Final IRA Report, Part B, pp. 121-123.
634
Final IRA Report, Part B, p. 123.
635
New Zealand’s first written submission, para. 4.274; also, para. 4.64 (Article 2.2).
636
New Zealand’s first written submission, paras. 4.440-4.443.
630
631
180
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18 July 2008
climatic conditions are more conducive to infection. No equivalent studies
exist from New Zealand…637
539.
Australia rejects the suggestion that there is no scientific evidence of latent infections
occurring in New Zealand. Latent infections are caused by the fungus entering the fruit through
the calyx-end, the stem-end, insect wounds, scab lesions or lenticels638 and remain dormant until
after harvest when the fruit becomes increasingly susceptible to rot. Such infection may not
become apparent until after three to seven months in storage.639 In samples of rotted apples
taken out of storage in Northern Ireland in 1963-64, 30% of the fruit rot was confirmed as N.
galligena.640
This example demonstrates that under favourable climatic conditions, with
sufficient inoculum, and host susceptibility, late infections in summer have the potential to cause
storage rots anywhere apples are grown, a fact attested to by evidence from New Zealand.641
540.
Nor does Australia accept New Zealand’s suggestion that scientific research about latent
infection in the United Kingdom and Northern Europe is irrelevant. First, as will be illustrated
later, New Zealand takes an inconsistent approach to the relevance of United Kingdom research.
541.
Secondly, it is disingenuous to suggest that the IRA Team should be restricted to looking
at studies of latent fruit rot in New Zealand, and ignoring the vast body of mycological work
carried out elsewhere in the world. Risk assessors in both Australia and New Zealand frequently
draw on pest studies from around the world and take into account differences in the
circumstances when seeking to use them “out of context” – indeed it would be against the
ISPMs642 not to do so. This was part of the IRA Team’s exercise of expert scientific judgment.
Given that Australia is free of N. galligena it was completely justifiable for the IRA Team to
draw on scientific evidence from countries where the disease is present. Further, the Final IRA
Report only refers to the United Kingdom and Northern Europe research on latent infection to
New Zealand’s first written submission, para. 4.272 (footnote omitted); see, also para. 4.273; also, paras.
4.52, 4.53, 4.57, 4.58, 4.61, 4.64, 4.65, 4.68, 4.73, 4.80 & 4.98 (Article 2.2).
638
Exhibit NZ-11: Swinburne (1964), p. 493; Exhibit NZ -8: Snowdon (1990); Exhibit NZ-9: Swinburne
(1975), p. 794.
639
Exhibit NZ -9: Swinburne (1975), p. 794.
640
Exhibit NZ -11: Swinburne (1964). Exhibit NZ -8: Snowdon (1990).
641
Exhibit NZ -34: Braithwaite (1996). Exhibit AUS-54: Ivess, R. (1996) Letter to B. Roberts from R.
Ivess, 15 July 1996, enclosing Braithwaite, M. (1996) "The occurrence of fruit rots caused by Nectria galligena
(European canker) in New Zealand and a comparison of brown rot strains between New Zealand and Australia",
Ministry of Agriculture and Forestry New Zealand report.
642
Exhibit AUS-6: ISPM 11, section 2.4 expressly refers to the need for “extrapolation from the situation
where the pest occurs” in determining the probability of introduction of a pest.
637
181
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18 July 2008
demonstrate how this event is likely to occur when conditions are favourable. 643 However,
information from New Zealand was used where directly relevant and available.
542.
Thirdly, Australia considers that New Zealand’s climate analysis is too narrow and its
predictions are inaccurate. Australia’s modelling identifies the potential distribution of European
canker in New Zealand (Annex 2, Figure 1).
d.
543.
New Zealand’s own research supports the IRA Team’s analysis
In attempting to make its case on latent infection, New Zealand tries to distance itself
from its own New Zealand Ministry of Agriculture report on the issue644, which states that:
It would be possible for European canker to be transmitted by the distribution
of infected fruit. Infections can be latent and may not become apparent until
after storage.645
…
Latent infections of European canker could go unnoticed at harvest or during
the early part of storage. It is therefore possible that infected apples or pears, if
discarded near susceptible hosts, could be a source of inoculum and give rise to
infections in new areas.646
544.
The New Zealand Ministry of Agriculture report also states that:
Observations indicate that where the disease is established, it becomes
relatively common. During a survey of apple sites from throughout New
Zealand in 1990, two percent of sites were found to be infected with
N. galligena. Fruit rot occurrences have also been reported ([New Zealand
Plant Protection Centre] records) and the fungus has been associated with
storage rots of apples (Mike Dance Pers. comm.), which suggests that latent
infections also occur in New Zealand fruit.647
545.
In the covering letter to Australia which accompanied this report, the Chief Plants Officer
of the New Zealand Ministry of Agriculture explicitly stated that:
Please find attached a report addressing AQIS’s concern regarding European
canker on New Zealand apple fruit. The report concludes that apple fruit are a
potential pathway for the introduction of European canker, as the fruit can
643
The life-cycle of N. galligena is the same in both the Southern and Northern Hemispheres, although
there may be some adaptation to local environmental conditions.
644
New Zealand’s first written submission, para. 4.273; also, paras. 4.62 & 4.63 (Article 2.2).
645
Exhibit NZ-34: Braithwaite (1996), p. 1.
646
Exhibit NZ-34: Braithwaite (1996), p. 4. (emphasis added)
647
Exhibit NZ-34: Braithwaite (1996), p. 5. (emphasis added)
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18 July 2008
develop latent or storage rots. It is clear, however, that orchards that are free
from symptoms are very unlikely to produce fruit infections.648
546.
Given that Braithwaite (1996) is an official New Zealand Ministry of Agriculture report,
endorsed by the Chief Plants Officer, the claims by New Zealand in the context of this dispute
that the report is “speculative” and “not substantiated”649 are untenable.
e.
547.
Summary
Australia has rebutted each of the arguments that New Zealand uses in support of its
criticism of Importation step 2. In doing so, Australia has demonstrated that there is scientific
support for the IRA Team’s scientific judgment that the likelihood that picked fruit is
infested/infected with N. galligena is between 10-6 and 10-3 (uniform distribution).650 Such a
probability range reflects the fact that this likelihood is “extremely low” as transparently defined
in the Final IRA report.651 Therefore, Australia rejects New Zealand’s assertion that the IRA
Team should have treated the probability of Importation step 2 as “negligible” in accordance
with New Zealand’s view of the meaning of that term.652 Accordingly, Australia submits that
New Zealand failed to identify any flaws in the IRA Team’s conclusions on Importation step 2.
ii.
548.
Importation step 3
Importation step 3 deals with the likelihood that clean fruit is contaminated by N.
galligena during picking and transport to the packing house. New Zealand asserts that:
The IRA’s analysis of [Importation step 3] is based on the assumption that
N. galligena spores could be transferred to clean fruit. This is an event that has
never been recorded and that would almost certainly not occur. As
acknowledged by the IRA, latently infected but symptomless fruit would not
have any rot and therefore could not generate spores (Dillon-Weston 1927).
Thus, there is no way for fruit contamination to occur.653
549.
Australia accepts that latently infected fruit would not generate spores for contamination
of clean fruit during picking and transport to the packing house654 as such infections develop
648
Exhibit AUS-54: Ivess (1996), p. 2. (emphasis added)
New Zealand’s first written submission, para. 4.273.
650
Final IRA Report, Part B, p. 123.
651
Final IRA Report, Part B, Table 12, p. 43.
652
New Zealand’s first written submission, para. 4.275; see also para. 4.277.
653
New Zealand’s first written submission, para. 4.277 (footnotes omitted; emphasis added); also,
paras. 4.53, 4.69, 4.70, 4.73, 4.75 & 4.76 (Article 2.2).
654
Final IRA Report, Part B, p. 124.
649
183
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
after a period in storage.655 However, Australia does not accept New Zealand’s categorical
assertion that there is no way for fruit contamination to occur during picking and transport to the
packing house.
The IRA Team identified various means by which clean fruit could be
contaminated: pickers’ hands or gloves contaminated with spores through touching cankers or
infected fruit; spores carried by rain splash or wind during harvesting and transport; and trash
with actively sporulating fungus and spores making contact with fruit in bins.656
550.
In support of its criticism of Importation step 3 New Zealand relies on arguments in
relation to: (a) conidia dispersal; (b) mummified fruit; and (c) alternative hosts.
a.
551.
Conidia can disperse and survive during harvest in New Zealand
New Zealand asserts that:
… conidia (the only spores produced at harvest) are not dispersed by wind but
require rainfall both to stimulate spore production and for dispersal (Munson
1939: 446, 452). Wet conditions are not typical during harvest time in major
New Zealand apple-growing areas, and so conidia are both very unlikely to be
produced and very unlikely to be dispersed.657
552.
The Final IRA Report acknowledges that: “[c]limatic conditions typically experienced
during harvest periods in most New Zealand orchards are not conducive to spore release and
infection” but goes on to say that “in the wetter districts of Auckland and the Waikato region,
conditions favour these processes.”658 In addition, official rainfall data shows that during harvest
time (February-April)659, there is considerable rain in all New Zealand’s apple growing areas
during these months.660 Further, it is worth noting that despite criticising Australia’s reliance on
research from the United Kingdom,661 in order to support its position on spore production New
Zealand cites work carried out by Munson (1939) in United Kingdom.662
Exhibit NZ-9: Swinburne (1975), p. 794.
Final IRA Report, Part B, p. 124.
657
New Zealand’s first written submission, para. 4.278; also, paras. 4.65 & 4.66 (Article 2.2).
658
Final IRA Report, Part B, p. 125. (emphasis added)
659
New Zealand’s first written submission, Annex 2, p. 217.
660
Exhibit AUS-55: Dive T.E.C., Mean Monthly Rainfall (mm):
http://homepages.ihug.co.nz/~petemes/mean_monthly_rainfall.htm.
661
New Zealand’s first written submission, paras. 4.272 & 4.273; see also para. 4.284; also, para. 4.73
(Article 2.2).
662
Exhibit NZ -37: Munson (1939).
655
656
184
Australia – Apples (DS367)
553.
Australia’s First Written Submission of Australia
18 July 2008
The Final IRA Report refers to evidence of occasional European canker fruit rot in New
Zealand due to wet conditions during harvest in the summer.663 This rotting fruit can produce
spore pustules bearing numerous conidia.664
554.
New Zealand also asserts that:
… even if conidia could be dispersed by rain onto the surface of a mature
apple immediately prior to or during harvest, they are sensitive to desiccation
and would be unlikely to survive without continued moisture …665
555.
Australia considers that this is an oversimplification. When dessert apple varieties were
monitored from the beginning of storage in November until the end of storage in April in
Romania, N. galligena was isolated from the surface, inside and even the locules of the fruit.666
556.
The Final IRA Report notes that “germination falls off steadily to zero after desiccation
in the atmosphere of a laboratory for 5 to 6 days” (Munson, 1939).667 However, this research
needs to be considered in “real world” context. Infection of the fruit takes place through open
calyx, lenticels, scab lesions or wounds caused by insects.668 Conidia germinate and produce
infection in the warm temperatures of summer and only 2-6 hours of wetness is required.669 The
summer rain fall pattern in New Zealand670 can provide such conditions. Further, given that fruit
infection occurs in New Zealand671 it is clear that not all conidia deposited on the fruit in summer
are killed by desiccation (even if this may happen under laboratory conditions when spores are
held on cover glasses for 5-6 days672). Rather, some conidia survive the summer, allowing
storage rot to occur later.
557.
Fruit rot commonly occurs through the calyx end of the fruit, which can remain moist for
long periods after rain. Also, moisture from mist or dew can trickle down to the calyx carrying
663
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a): Final IRA Report, Part B, pp. 121-123.
664
Exhibit NZ-99: Snowdon (1990).
665
New Zealand’s first written submission, paras. 4.278; also, para. 4.67 (Article 2.2).
666
Exhibit AUS-56: Puia, C., Oroian, I. and Florian, V. (2004), “Effect of Ozone Exposure on
Phytopathogenic Microorganisms on Stored Apples” Journal of Agricultural Sciences, Debrecen, 2004/15, pp9-13.
667
Final IRA Report, Part B, p. 124. (emphasis added)
668
Exhibit NZ-9: Swinburne (1975).
669
Final IRA Report, Part B, p. 120.
670
Exhibit AUS-55 and Annex 2
671
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a): Final IRA Report, Part B, pp. 121-123..
672
Final IRA Report, Part B, p. 124. (emphasis added) Exhibit NZ-60: Dillon-Weston (1927), p454
185
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
conidia from the rest of the fruit surface. Many apple rotting fungi are known to enter from the
calyx end, stem end and lenticils.673
b.
558.
Mummified fruit are another source of contamination
New Zealand asserts that:
The other suggested source of spores at harvest, rotten fruit that has
mummified on trees or on the orchard floor, is implausible. Mummified fruit
would not be a source of contamination, as formation of perithecia takes place
during winter and they are not therefore even present at harvest (Swinburne
1964: 493).674
559.
There is information that shows that spores can be present at harvest. The Final IRA
Report, citing Dillon-Weston (1927), notes that “[i]nfected fruit that drops before harvest, or that
remains on trees and becomes mummified during winter can develop perithecia in spring,
producing ascospores that could contaminate other fruit.”675
This position is endorsed by
Swinburne (1975) which states that “[i]nfected apples left on a tree or on the orchard floor
become mummified and are a source of further infection.”676
c.
New Zealand misunderstands the Final IRA Report regarding
alternative hosts
560.
New Zealand mistakenly claims that the Final IRA Report:
… suggests that contamination from alternative hosts is possible during harvest
in “the wetter districts of Auckland and the Waikato”.677
561.
New Zealand’s claim in this regard appears to be based on a misunderstanding of the
relevant sentence in the Final IRA Report which is directed at the climatic conditions during
harvest in New Zealand apple orchards, rather than alternative hosts.678 In fact, the Final IRA
673
Exhibit AUS-57: Combrink, J.C. and Ginsburg, L. (1973) "Core rot in Starking apples - a preliminary
investigation into the origin and control" The Deciduous Fruit Grower 23, pp16-19; Exhibit AUS-58: Agarwala,
R.K. and Sharma, V.C. (1968) "Storage rot diseases of apple" Indian Phytopathology 21, pp. 294-298.
674
New Zealand’s first written submission, paras. 4.279. (footnote omitted)
675
Final IRA Report, Part B, p. 124.
676
Exhibit NZ-9: Swinburne (1975), p. 794.
677
New Zealand’s first written submission, paras. 4.280. (footnotes omitted)
678
Final IRA Report, Part B, p. 125.
186
Australia – Apples (DS367)
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18 July 2008
Report expressly acknowledges that “there is no evidence that the [N. galligena] is well
established in other hosts in New Zealand.” 679
d.
562.
Summary
Australia has rebutted each of New Zealand’s arguments on Importation step 3. This is
just one of many examples where New Zealand argues that there is a “correct conclusion to draw
from the scientific literature”680, ignoring the fact that there can be more than one credible
interpretation of the evidence.
563.
Australia has clearly demonstrated that there is scientific support for the IRA Team’s
expert judgment that, the likelihood that clean fruit is contaminated by N. galligena during
picking and transport to the packing house, is between 10-6 and 10-4, with a most likely value of
10-5 (triangular distribution).681 Therefore, Australia rejects New Zealand’s assertion that the
IRA Team should have treated the probability of Importation step 3 as “negligible” in
accordance with New Zealand’s view of the meaning of that term.682 Accordingly, Australia
submits that New Zealand failed to identify any flaws in the IRA Team’s conclusions on
Importation step 3.
iii.
564.
Importation step 4
Importation step 4 deals with the likelihood that N. galligena survives routine processing
procedures in the packing house. New Zealand alleges that:
The IRA’s analysis of [Importation step 4] is based on an assumption that fruit
entering the packing house will be infected or infested – an event which itself
has a negligible likelihood of occurring.683
565.
Again New Zealand misunderstands the methodology underlying the Final IRA Report
which states that:
Each importation step has been considered conditionally on an apple arriving
at the given point in the pathway. In most cases, however, the likelihoods are
679
Final IRA Report, Part B, p. 123.
New Zealand’s first written submission, para. 4.281.
681
Final IRA Report, Part B, p. 125.
682
New Zealand’s first written submission, para. 4.281.
683
New Zealand’s first written submission, para. 4.282; also, paras. 4.53, 4.69, 4.70, 4.73, 4.75 & 4.76
(Article 2.2).
680
187
Australia – Apples (DS367)
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18 July 2008
evaluated independently of the previous likelihoods; that is, they are fixed
regardless of the pathway that is being considered.684
566.
Accordingly, whatever the infection/infestation present on the fruit when they arrive,
Importation step 4 evaluates the likelihood of N. galligena surviving the routine procedures in
the packing house, independently of Importation steps 2 and 3. In any event, Australia rejects
New Zealand’s unsubstantiated assertion that the likelihood that fruit entering the packing house
will be infected or infested is “negligible”, in accordance with New Zealand’s view of the
meaning of that term.
567.
New Zealand also alleges that:
The IRA claims that “none of the processes in the packing house are likely to
substantially reduce infections”. However there is no relevant scientific
evidence on which to determine this likelihood. The scientific data relied on
by Australia in the IRA to support its theories are simply not applicable.685
568.
New Zealand’s attempt to summarily dismiss the IRA Team’s exercise of expert
scientific judgment in relation to Importation step 4 is unsustainable. It conveniently ignores the
fact that the Final IRA Report contains detailed discussion on Importation step 4 with extensive
reference to relevant scientific literature.686 The IRA Team reached its conclusion on the basis
of a balanced assessment of the available scientific evidence.
The Final IRA Report
transparently explains the IRA Team’s scientific judgment as to why each step in the packing
house – pre-cooling, washing, brushing, waxing, sorting and grading, and cold storage – is
unlikely to substantially reduce infections.
569.
In support of its claims on Importation step 4, New Zealand relies on arguments in
relation to: (a) latent infection and storage rot; (b) mode of trade; and (c) washing.
a.
Latent infection and storage rot occur in mature, dessert varieties
of apples
570.
New Zealand rehearses its familiar argument that:
The studies referred to in the IRA on latent survival and the incidence of
storage rot rely on data from the United Kingdom and Northern Europe where
684
Final IRA Report, Part B, p. 21. (emphasis added)
New Zealand’s first written submission, para. 4.283. (footnote omitted)
686
Final IRA Report, Part B, pp. 125-126.
685
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the climate is much more conducive to European canker and fruit rots than
New Zealand.687
571.
Australia clearly demonstrated in the context of Importation step 2, why scientific
research about latent infection in the United Kingdom and Northern Europe is relevant to the
importation of apples from New Zealand. Further, New Zealand argues that:
… this research [on latent survival and the incidence of storage rot] related to
immature and cooking cultivars not the mature, dessert varieties typically
exported by New Zealand.688
572.
Australia rejects any implication that latent infection and storage rot do not occur in
mature, dessert varieties of apples.
According to Swinburne (1971a): “[r]otting following
infection by N. galligena is common among dessert apples and pears”. It is well accepted that
fruit infection occurs in New Zealand689, which produces predominantly dessert varieties. It is
likely that such infections occur in dessert varieties. The same holds true for storage rots, which
have also been reported in New Zealand and are attributed to latent infection.690 Australia again
notes that the IRA Team asked New Zealand authorities to provide information on fruit rot but
this was not forthcoming. In any event, research in Romania has demonstrated the occurrence of
latent infection during storage in Jonathan, a dessert variety.691
573.
Finally, New Zealand argues that:
The IRA does not provide any scientific evidence of latent survival or storage
rots in relation to mature, symptomless New Zealand apples.692
574.
This sweeping statement is wrong. First, the product at issue in this dispute is “mature
apple fruit free of trash, either packed or sorted and graded bulk fruit from New Zealand”, not
“mature, symptomless New Zealand apples”.
Secondly, the Final IRA Report contains
numerous references to scientific literature on “latent survival or storage rots”.693
687
New Zealand’s first written submission, para. 4.284; also, paras. 4.61, 4.68 & 4.73 (Article 2.2).
New Zealand’s first written submission, para. 4.284; also, para. 4.62 (Article 2.2).
689
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a): Final IRA Report, Part B, pp. 121-123.
690
Exhibit NZ-34: Braithwaite, 1996; Final IRA Report, Part B, pp. 122 & 123.
691
Exhibit AUS-56: Puia et al. (2004).
692
New Zealand’s first written submission, para. 4.284. (emphasis added) See also para 4.287.
693
Exhibit AUS-59: Holmes, R.J. (1993) “Diseases causing post-harvest crop loss of apples and pears:
Epidemiology and control” PhD Thesis, LaTrobe University, Australia, pp100-166; Exhibit-NZ-37: Munson
(1939); Exhibit AUS-60: Butler, E.J. (1949) “Apple canker, Nectria galligena Bres” In: Bulter, E.J. and Jones, S.G.
(Eds) Plant Pathology, Macmillan, London, pp. 724-728; Exhibit NZ-39: Marsh (1940); Exhibit NZ-63: Lortie
and Kuntz (1963); Exhibit AUS-61: Bondoux, P. and Bulit, J. (1959) “Sur la pourriture des pommes due au
688
189
Australia – Apples (DS367)
b.
575.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand’s ambivalence towards the mode of trade
New Zealand asserts that:
Since the majority of consignments of New Zealand mature, symptomless
apple fruit will be ‘retail-ready’ and ‘just-in-time’, if latently infected fruit
were to develop visible rot symptoms in storage, this would be detected and
removed at the time of packaging while the fruit was still in New Zealand and
accordingly would not enter Australia.694
576.
Any attempt by New Zealand to transform the product at issue in this dispute into
“mature symptomless apples” must be rejected by the Panel. Similarly, any attempt by New
Zealand to transform the product at issue in this dispute into “retail-ready” “just-in-time” apple
fruit695 must also be rejected. New Zealand’s use of the word “majority” in the above quote is
indicative of its continued ambivalence towards the mode of trade. Further, as discussed below,
it is unlikely that New Zealand exporters would provide fruit in the “retail ready” form required
by one of Australia’s largest supermarket chains which uses returnable plastic crates.696 Instead,
they are likely to opt for the best commercially available option, namely, shipping fruit in bulk
bins.
577.
In any event, the importation of “retail-ready” “just-in-time” apple fruit from New
Zealand would mean quick export following varying periods of storage. Any latent infections
would only develop after removal from cold storage. This would reduce the likelihood of
detecting latent infections caused by N. galligena and increase the likelihood of it reaching
Australia.
Cylindrocarpon mali (All.) Wr. Comptes Rendus de l’Academie d’Agriculture de France 45, pp. 275-277; Exhibit
NZ-11: Swinburne (1964); Exhibit NZ-9: Swinburne (1975); Exhibit NZ-8: Snowdon (1990).
694
New Zealand’s first written submission, para. 4.285 (emphasis added); also, para. 4.74 (Article 2.2).
695
The term is defined as follows in New Zealand’s first written submission, para. 4.74: “cold stored in
bulk in the country of origin and then packaged only a few days before shipment, ready for immediate use by retail
outlets in the destination market”. The Final IRA Report notes at page 9 that New Zealand indicated to the IRA
Team that it “expects to export only retail-ready, class 1 export quality fruit in a range of packaging including
cartons, bags and crates and advises that this fruit will be exposed to a minimum of 10-14 days cold storage from
harvest to retail sale.
696
Exhibit AUS-62: Coles Myer’s returnable plastic crate initiative: Coles Group, National Packaging
Covenant
Annual
Report
2006/7,
p.
27
(website
http://www.packagingcovenant.org.au/documents/File/Coles_Group_AR_06_07_Public.pdf, accessed 9 July 2008);
Coles
Myer
Ltd,
Corporate
Social
Responsibility
Report
2005,
p.
16
(website
http://www.colesgroup.com.au/library/newsmedia/20051019_corporate_social_responsibility_report.pdf, accessed 9
July 2008); Exhibit AUS-63: United States Department of Agriculture Foreign Agricultural Service, “New Zealand
Fresh Deciduous Fruit Report 2007”, GAIN Report Number: NZ7033, 18 December 2007, p. 8.
190
Australia – Apples (DS367)
c.
578.
Australia’s First Written Submission of Australia
18 July 2008
Washing would not remove all surface spores
New Zealand argues that:
Concerning infestation, the IRA acknowledges that “[i]nitial washing of fruit
in a dump tank and subsequent high-volume, high-pressure water washing (if
available) may remove surface spores…”, but then fails to factor this into its
analysis. … These processes have been shown to be highly effective in
removing other external contaminants (Walker and Bradley 2006: 2).697
579.
New Zealand’s assertion that the IRA Team did not factor into its analysis the removal of
surface spores during washing is incorrect. It is important to note that the Final IRA Report
recognises that washing “may” remove surface spores, not that it “will” do so. The IRA Team
had no published data to prove that all surface spores would be removed by washing. 698 The
Walker and Bradley (2006) study699 referred to by New Zealand shows that washing has been
effective in removing mealybugs but it does not deal with fungal spores. Finally, it is worth
recalling that surface spores are only one aspect of the pathway and that washing “will have no
effect on internal infections, and the fungus will survive these procedures”.700 The 0.7 to 1
probability range for Importation step 4 illustrates that the IRA Team allowed for removal of
some surface spores, otherwise it would have assigned a probability of 1 to this step.
d.
580.
Summary
Australia has rebutted each of the arguments that New Zealand uses in support of its
claims under Importation step 4. Australia has demonstrated that, contrary to New Zealand’s
primary allegation,701 there is scientific support for the IRA Team’s expert judgment that the
likelihood that N. galligena survives routine processing procedures in the packing house is
between 0.7 and 1, with a most likely value of 0.85 (triangular distribution).702 Accordingly,
Australia submits that New Zealand failed to identify any flaws in the IRA Team’s conclusions
on Importation step 4.
New Zealand’s first written submission, para. 4.286 (footnotes omitted; emphasis added); also, paras.
4.71 & 4.72 (Article 2.2). (emphasis added)
698
Exhibit AUS-59: Holmes (1993). Exhibit: NZ-36: Scheper et al. (2007).
699
Exhibit NZ-61: Walker and Bradley (2006).
700
Final IRA Report, Part B, p. 125.
701
New Zealand’s first written submission, para. 4.287.
702
Final IRA Report, Part B, p. 126.
697
191
Australia – Apples (DS367)
iv.
581.
Australia’s First Written Submission of Australia
18 July 2008
Importation step 5
Importation step 5 deals with the likelihood that clean fruit is contaminated by
N. galligena during processing in the packing house. New Zealand argues that:
[Importation step 5], like [Importation] step 3, rests on the assumption that
infested or infected mature apples – assuming they exist in the first place –
would contaminate clean fruit. However, as has been pointed out already, the
scientific evidence suggests that the likelihood of this happening during
picking and transport is negligible. It is equally negligible during processing
in the packing house.703
582.
Australia has already clearly demonstrated that New Zealand’s arguments in relation to
Importation step 3 are flawed. Similarly, Australia rejects New Zealand’s assertion that the IRA
Team should have treated the probability of Importation step 5 as “negligible” in accordance
with New Zealand’s view of the meaning of that term.
583.
In support of its claims under Importation step 5, New Zealand relies upon arguments in
relation to: (a) latent fruit infection; (b) dump water; and (c) twigs in the dump tank.
a.
584.
Latent fruit infection occurs in New Zealand
New Zealand selectively extracts704 the following sentence from the Final IRA Report
without any explanation or elaboration as to why it considers it to be relevant to its case:
Latent fruit infections present a “minimal likelihood” of contamination in the
processing pathway because spores do not develop on infected fruit until they
become severely rotted or mummified.705
585.
Australia assumes that New Zealand has referred to this sentence because of its fixation
with using its own qualitative method for risk assessment. However, as previously noted the
SPS Agreement is not prescriptive as to methodology.
In addition, Australia has already
demonstrated that New Zealand’s focus on the descriptive likelihoods, and not the numbers, is
misplaced.
586.
In any event, New Zealand conveniently ignores the fact that latent fruit rot caused by
N. galligena does occur in New Zealand.706 In fact, recent data from the New Zealand Ministry
New Zealand’s first written submission, para. 4.288 (emphasis added); see also para. 4.292; paras. 4.53,
4.69, 4.70, 4.73, 4.75 & 4.76 (Article 2.2).
704
New Zealand’s first written submission, para. 4.289 (emphasis added); also, para. 4.70 (Article 2.2).
705
Final IRA Report, Part B, p. 127. (emphasis added)
703
192
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
of Agriculture suggests that the likelihood of fruit infection has increased (0.21% for Waikato
region alone).707 Presumably this is because of the greater production of apples in New Zealand
and the fact that N. galligena has not been eradicated but is still spreading.
b.
587.
Fruit can be contaminated in dump water
New Zealand also selectively extracts708 the following sentence from the Final IRA
Report without any explanation or elaboration as to why it considers it to be relevant to its case:
… “given the extremely small likelihood of fruit being infested/infected with
N. galligena, the probability of surface spores being present on fruit and
contaminating the dump water is similarly extremely small.” (emphasis
added)709
588.
Again, Australia assumes that New Zealand has referred to this sentence because of its
fixation with using its own qualitative method for risk assessment. Again, Australia reiterates
that the SPS Agreement is not prescriptive as to methodology and New Zealand’s focus on the
descriptive likelihoods and not the numbers is misplaced.
589.
In any event, it has been demonstrated that conidia from external infections of other fungi
can be washed off into the dump tank water, thereby potentially contaminating clean fruit.710 In
addition, recent data shows that, irrespective of the fungal pathogen concentration, post harvest
washing did not alter the incidence of storage rots in uninjured fruit but apples with wounds were
prone to storage rots in the presence of high fungal concentration.711
c.
590.
Fruit can be contaminated by twigs in the dump tank
New Zealand argues that:
The IRA also asserts a probability, albeit “extremely low”, of clean fruit
becoming contaminated by twigs or by washing in the dump tank. This is
unsubstantiated speculation, and is certainly not supported by the scientific
706
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Final IRA Report, Part B, pp. 121-123.
707
Exhibit AUS-51: MAFNZ, 2005a: Final IRA Report, Part B, p. 122.
708
New Zealand’s first written submission, para. 4.290; also, paras. 4.71 & 4.72 (Article 2.2).
709
New Zealand’s first written submission, para. 4.290 (quoting: Final IRA Report, Part B, p. 127).
710
Exhibit: AUS-59: Holmes (1993). See Final IRA Report, Part B, p. 126.
711
Exhibit: NZ-36: Scheper et al. (2007), pp. 7, 9-13.
193
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
evidence: contamination of clean fruit with N. galligena during processing in
the packing house has never been observed to occur.712
591.
Once again, New Zealand conveniently ignores the fact that the Final IRA Report
contains detailed discussion on Importation step 5 including references to relevant scientific
literature.713 Australia rejects New Zealand’s allegation that contamination through twigs in the
dump tank or through washing in the dump tank is “unsubstantiated speculation” and is “not
supported by the science”. Australia has already dealt with the issue of contamination of clean
fruit via the dump tank and will now turn to the issue of twigs in the dump tank.
592.
On the basis of practical experience, the IRA Team judged that twigs are likely to enter
the dump tank. This view is supported by photographic evidence from the packing houses in
Hawke’s Bay, New Zealand which shows a lot of plant debris removed from the dump tank.714
Further, there is evidence of the development of small cankers around buds of one year old twigs
in Chile.715 The potential for such infections to develop in other apple growing countries, like
New Zealand, cannot be excluded. These infected twigs are very close to the apple fruit and
would be harvested with the fruit with some ending up as trash in the dump tank.
593.
Australia accepts that, in the event of small sporulating cankers entering the dump tank,
the likelihood of clean fruit getting infected due to twigs is “extremely low”.716 In part, this is
because “there would be a very large dilution of spores in the tank and surface contamination
could be washed off in any subsequent high pressure wash.”717 The IRA Team clearly took this
into account in determining the probability range for Importation step 5.
d.
594.
Summary
Australia has rebutted each of New Zealand’s arguments regarding Importation step 5. In
doing so, Australia has demonstrated that there is scientific support for the IRA Team’s scientific
judgment that the likelihood that clean fruit is contaminated by N. galligena during processing in
712
New Zealand’s first written submission, para. 4.291 (footnotes omitted) (emphasis added); also, paras.
4.71 & 4.72 (Article 2.2).
713
Final IRA Report, Part B, pp. 126-127.
714
Exhibit AUS-64: Photograph of trash in a dump tank from a packing house in Hawke’s Bay, New
Zealand, 5/5/1999.
715
Exhibit AUS-65: Lolas, M. and Latorre, B.A. (1997), “Effecto Comparativo de Fungicidas en el control
del Cancro Europeo Del Manzano Causado Por Nectria galligena”, Fitopatologia 32(2), pp131-135.
716
Final IRA Report, Part B, p. 127.
717
Final IRA Report, Part B, p. 127. (emphasis added)
194
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
the packing house is between 10-5 and 10-4, with a most likely value of 5 x 10-5 (triangular
distribution).718 Therefore, Australia rejects New Zealand’s assertion that the IRA Team should
have treated the probability of Importation step 5 as “negligible” in accordance with New
Zealand’s view of the meaning of that term.719 Accordingly, Australia submits that New Zealand
failed to identify any flaws in the IRA Team’s conclusions on Importation step 5.
v.
595.
Importation step 6
Importation step 6 deals with the likelihood that N. galligena survives palletisation,
quality inspection, containerisation and transportation. New Zealand alleges that:
… the likelihood value of “1” [for Importation step 6] is an overestimation
because, even assuming that some fruit could be latently infected at the point
of palletisation, a proportion of fruit with latent infection would never develop
symptoms (Biggs 19[9]5). The actual proportion of fruit with latent infection
that might eventually develop symptoms would be much less than 100%.720
596.
Australia does not accept New Zealand’s assertion that the likelihood value assigned to
Importation step 6 is an overestimation. First, Biggs (1995)721 does not deal with N. galligena
and in this context it is not entirely relevant. Secondly, infections in latently infected fruit will
often not manifest until after three to seven months in storage.722
597.
The IRA Team considered that, “[t]he time between Importation step 4 and Importation
step 6 will not be long enough for latent infection to express itself to a significant level. Because
spores are microscopic, any remaining surface infestation will also remain undetected and
survive.”723
598.
Australia rejects New Zealand’s argument that the likelihood value for Importation step 6
is “speculative”.724 There is scientific support for the IRA Team’s judgment that the likelihood
that N. galligena survives palletisation, quality inspection, containerisation and transportation is
718
Final IRA Report, Part B, p. 127.
New Zealand’s first written submission, para. 4.292; see, also para. 4.288.
720
New Zealand’s first written submission, para. 4.294; also, paras. 4.53, 4.69, 4.70, 4.73, 4.75, 4.76 &
4.81 (Article 2.2).
721
Exhibit NZ-62: Biggs (1995).
722
Exhibit NZ -9: Swinburne (1975), p. 794; Exhibit NZ -8: Snowdon (1990), p. 184; and Exhibit AUS61: Bondoux and Bulit (1959). Also, see Final IRA Report, Part B, p. 122.
723
Final IRA Report, Part B, p. 127.
724
New Zealand’s first written submission, para. 4.295.
719
195
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
1.725 Australia does not accept New Zealand’s bald assertion that the probability assigned to
Importation step 6 “must certainly be lower than ‘1’”.726 Accordingly, Australia submits that
New Zealand failed to identify any flaws in the IRA Team’s conclusions on Importation step 6.
vi.
599.
Importation step 7
Importation step 7 deals with the likelihood that clean fruit is contaminated by
N. galligena during palletisation, quality inspection, containerisation and transportation. New
Zealand asserts that:
The IRA states clear reasons why the [likelihood in relation to Importation
step 7] is negligible. For example, the IRA states: “Packed fruit would be
securely stored and would present a “negligible” likelihood of becoming
contaminated during palletisation, quality inspection and transportation. The
short period of storage and temperatures maintained during transportation
would not be conducive to spore production” (emphasis added). However,
when the likelihoods assigned to this step are used in the Australian model, this
again results in a negligible event being mischaracterised as an event that is
likely to occur – approximately one in every two million apples imported from
New Zealand. This ‘probability’ value has no basis in science.727
600.
This is yet another example of New Zealand’s argument that Australia is not entitled to
use a semi-quantitative methodology for risk assessment. Again, the SPS Agreement is not
prescriptive as to methodology and that New Zealand’s focus on the qualitative descriptors and
not the numbers is misplaced. It is worth noting that, in the relevant paragraph of the Final IRA
Report728 referred to above by New Zealand, the word “negligible” very deliberately appears in
inverted commas as a caution against any pre-determined views about its meaning.
601.
Australia rejects New Zealand’s unsubstantiated assertion that the probability range for
Importation step 7 “has no basis in science”.729 In exercising its expert judgment the IRA Team
determined that the likelihood that clean fruit is contaminated by N. galligena during
palletisation, quality inspection, containerisation and transportation is between 0 and 10-6
(uniform distribution).730 Australia has previously explained why the use of such a probability
725
Final IRA Report, Part B, p. 128.
New Zealand’s first written submission, para. 4.295.
727
New Zealand’s first written submission, para. 4.296 (footnote omitted; original emphasis). See paras.
4.53, 4.69, 4.70, 4.73, 4.75 & 4.76 (Article 2.2).
728
Final IRA Report, Part B, p. 128.
729
New Zealand’s first written submission, para. 4.296.
730
Final IRA Report, Part B, p. 128.
726
196
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
interval is appropriate. Therefore, Australia rejects New Zealand’s assertion that the IRA Team
should have treated the probability of Importation step 7 as “negligible” in accordance with New
Zealand’s view of the meaning of that term.731 Accordingly, Australia submits that New Zealand
failed to identify any flaws in the IRA Team’s conclusions on Importation step 7.
vii.
602.
Importation step 8
Importation step 8 deals with the likelihood that N. galligena remains with the fruit after
on-arrival minimum border procedures.
Although New Zealand does not contest this
importation step732 it asserts that:
[Importation step 8] depends on an assumption about mature, symptomless
apple fruit being a pathway for the transmission of European canker for which
there is no scientific evidence, and for which the likelihood has been
demonstrated to be negligible.733
603.
Australia reiterates that the product at issue in this dispute is “mature apple fruit free of
trash, either packed or sorted and graded bulk fruit from New Zealand” not “mature,
symptomless apple fruit”. In any event, New Zealand’s allegation that there is no scientific
evidence that “mature, symptomless apple fruit” are a pathway for transmission of European
canker is inconsistent with a statement to the contrary by the Chief Plants Officer of the New
Zealand Ministry of Agriculture.734
Further, New Zealand has not demonstrated that the
likelihood of “mature, symptomless, apple fruit” being such a pathway is “negligible” in
accordance with New Zealand’s view of the meaning of that term.
viii.
604.
Summary on entry
New Zealand’s language about “speculation” and “possibilities”735 cannot remedy its
failure to meet its burden of proof in relation to each of the challenged importation steps for
European canker. New Zealand has failed to adduce sufficient evidence of any flaws in the IRA
Team’s assessment of entry, let alone any flaws serious enough to prevent the Panel from having
“reasonable confidence” in the risk assessment.
New Zealand’s first written submission, para. 4.296.
New Zealand’s first written submission, para. 4.298.
733
New Zealand’s first written submission, para. 4.298 (emphasis added); see also paras. 4.268 & 4.299;
also, paras. 4.52, 4.53, 4.95, 4.96, 4.97, 4.98, 4.99, 4.100, 4.104 & 4.105 (Article 2.2).
734
Exhibit AUS-54: Ivess (1996).
735
New Zealand’s first written submission, paras. 4.268 & 4.300.
731
732
197
Australia – Apples (DS367)
(b)
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team’s analysis of the probability of establishment and spread is
objective and credible
605.
New Zealand alleges that the IRA Team failed to evaluate the likelihood of establishment
or spread of N. galligena within the meaning of Annex A(4) of the SPS Agreement.736 There are
two aspects to New Zealand’s claim.
First, New Zealand asserts that the IRA’s Team’s
consideration of proximity and exposure “is based on possibilities not probabilities”.737
Secondly, New Zealand asserts that the IRA Team’s consideration of establishment and spread
“is based on possibilities not probabilities”.738
i.
The IRA Team’s consideration of proximity and exposure is based on
probabilities not possibilities
Proximity
606.
The IRA Team assessed the proximity of major handlers and users of apples to host
plants for N. galligena.
New Zealand does not seriously address the issues raised in the
comprehensive discussion of proximity for N. galligena in the Final IRA Report.739 Instead,
New Zealand merely asserts that:
… [the proximity] values [for N. galligena] are assigned in a seemingly
arbitrary manner and describe events that in reality have a very low likelihood
of occurring. For example, orchard wholesalers near commercial fruit crops
are assigned a proximity rating of 1 (certainty). However the text in [the Final
IRA Report] describing the rationale for assigning this probability value shows
that this is in fact no more than a possibility: “orchard wholesaler waste may be
dumped at a site…close to landfills. Before waste is finally disposed of, it
could remain exposed to the elements…near the packing house” (emphasis
added).740
607.
Australia rejects New Zealand’s allegation that the IRA Team used arbitrary proximity
values. All the proximity values for N. galligena are set out in Table 32 of the Final IRA
Report741 with an accompanying explanation in the text.742 Australia accepts that many of the
New Zealand’s first written submission, para 4.301.
New Zealand’s first written submission, paras. 4.302-4.317.
738
New Zealand’s first written submission, paras. 4.318-4.325.
739
Final IRA Report, Part B, pp. 129-134
740
New Zealand first written submission, para. 4.302. (original emphasis)
741
Final IRA Report, Part B, p. 134.
742
Final IRA Report, Part B, pp. 130-133.
736
737
198
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
events in relation to proximity have a “very low” likelihood of occurring. 743 In fact, some of
these events have an “extremely low” likelihood of occurring.744 Occasionally, the proximity
values are higher. Importantly, the IRA Team provided a justification for all of the proximity
ratings.745
608.
New Zealand has raised a concern in relation to the proximity value assigned to orchard
wholesalers and commercial fruit crops. Unfortunately, New Zealand has selectively quoted text
from the Final IRA report, and in doing so, they have also got the quote wrong. The actual text
reads as follows:
All orchard wholesalers would be in close proximity to commercial fruit crops.
Orchard wholesaler waste may be dumped at a site within the premises or in
landfills close to orchards. Before waste is finally disposed of, it could remain
exposed to the elements (for example, in a skip) near the packing house.746
609.
The Final IRA Report also notes that:
The packing of New Zealand fruit from bulk bins and/or the repacking of
boxes of New Zealand fruit would bring packing house workers and host trees
(apples and pears) into close proximity to both New Zealand apples and apple
waste.
Some stakeholders argued that not all orchard wholesalers will be near
commercial fruit crops and that the use of probability 1 is incorrect. However,
industry sources confirmed that the few (about seven) orchard wholesalers in
Australia who are likely to repack/regrade the majority of New Zealand apples
would all be near commercial orchards.747
610.
Australian retail outlets often display large quantities of apples on tables or in crates,
rather than in smaller “retail ready” boxes. In 2005 the one of Australia’s largest supermarket
chains introduced a system of returnable plastic crates. These crates are sent to suppliers who
pack the fruit straight into them. They are used to display the fruit in the stores, and then
returned to the suppliers for re-use.748 It is unlikely that empty crates would be sent from
743
Final IRA Report, Part B, Tables 12 & 32, pp. 43 & 134.
Final IRA Report, Part B, Tables 12 & 32, pp. 43 & 134.
745
Final IRA Report, Part B, pp. 130-133.
746
Final IRA Report, Part B, p. 130. (emphasis added)
747
Final IRA Report, Part B, p. 131. (emphasis added)
748
Exhibit AUS-62: Coles Myer’s returnable plastic crate initiative: Coles Group, National Packaging
Covenant
Annual
Report
2006/7,
p.
27
(website
http://www.packagingcovenant.org.au/documents/File/Coles_Group_AR_06_07_Public.pdf, accessed 9 July 2008);
Coles
Myer
Ltd,
Corporate
Social
Responsibility
Report
2005,
p.
16
(website
http://www.colesgroup.com.au/library/newsmedia/20051019_corporate_social_responsibility_report.pdf, accessed 9
744
199
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Australia to New Zealand in order for New Zealand exporters to pack their apples for Australia.
Accordingly, it is unlikely that New Zealand exporters would provide fruit in the “retail ready”
form required by one of Australia’s largest retailers. Instead, New Zealand exporters are likely
to opt for the best commercially available option, namely shipping fruit in bulk bins that could be
repacked and distributed in Australia for specific markets. The fact that orchard wholesalers
who would repack such fruit are in close proximity to commercial fruit crops is confirmed by
available aerial photographic evidence.749
611.
In Australia’s view, this explanation clearly justifies that the IRA Team’s proximity
rating for commercial fruit crops and orchard wholesalers is based on probabilities not
possibilities. Given that New Zealand has not specifically challenged any other proximity rating
in the Final IRA Report, it is precluded from making further claims at a later stage of
proceedings.
Exposure
612.
The IRA Team assessed the probability of transfer of N. galligena from a discarded apple
to a susceptible host plant, also known as exposure. New Zealand’s criticism of the IRA Team’s
exposure analysis is confused and repetitive.
It appears that the crux of New Zealand’s
complaint is as follows:
… [the IRA Team’s assessment of exposure] assumes that a sufficient quantity
of spores [conidia or ascospores] could be produced from an infected apple and
dispersed under suitable climatic conditions to infect a susceptible host.
However, there is no scientific evidence to show that there is any likelihood
that this could occur.750
613.
Australia does not accept New Zealand’s assertion. The Final IRA Report contains a
comprehensive discussion of exposure for N. galligena.751 The Final IRA Report cites several
studies which show that fruit rot caused by N. galligena does occasionally occur in New
Zealand.752 Moreover, the Chief Plants Officer of the New Zealand Ministry of Agriculture has
July 2008); Exhibit AUS-63: United States Department of Agriculture Foreign Agricultural Service, “New Zealand
Fresh Deciduous Fruit Report 2007”, GAIN Report Number: NZ7033, 18 December 2007, p. 8.
749
Exhibit: AUS-66: Images of an orchard packing house near Melbourne.
750
New Zealand first written submission, paras. 4.303 (emphasis added); also, paras. 4.304, 4.309, 4.312,
& 4.317; also, para. 4.78 (Article 2.2).
751
Final IRA Report, Part B, pp. 134-139.
752
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook & Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a); Final IRA Report, Part B, pp. 121-123.
200
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
explicitly endorsed the fact that “apple fruit are a potential pathway for the introduction of
European canker, as the fruit can develop latent or storage rots.”753 Accordingly, there is no
doubt that some latently infected apples will arrive in Australia.
614.
Further, there is no doubt that when such fruit eventually rot they will be discarded as
waste in Australia. Braithwaite (1996) notes that infected apples discarded near susceptible
hosts could be a source of inoculum and give rise to infections in new areas. 754 Dillon-Weston
(1927)755 shows that infected fruit left on the orchard floor which become mummified, can
produce perithecia with mature ascospores, and are a source of further infection. Similarly,
rotting fruit can produce both conidia and perithecia with ascospores. 756 In particular, the New
Zealand strain of the N. galligena is known to produce both conidia and ascospores.757 Given
that perithecia form in August (winter) in New Zealand758 there is no reason why they would not
form on discarded rotting fruit in Australia in August as it is also in the Southern Hemisphere.
615.
It is well accepted that spores are dispersed by rain splash and wind.759 Many studies
discuss this dispersal mechanism within orchards. However, such dispersal could similarly
apply to rotting fruit discarded as waste nearby a suitable host plant. For example, waste near an
orchard or a backyard compost heap close to susceptible fruit trees. In addition, birds and insects
are suspected as dispersal mechanisms of N. galligena.760 Birds feed on fruit discarded in waste
and fly on to branches of trees. They are therefore a potential agent to transfer the spores from
infected fruit, carried on their beaks or feet, to branches of hosts where the fungus is known to
establish easily.761
616.
New Zealand also appears to suggest that Australia’s climate is unsuitable for exposure.
As previously indicated, Australia considers New Zealand’s climate analysis762 to be too narrow.
753
Exhibit AUS-54: Ivess (1996).
Exhibit NZ-34: Braithwaite (1996), p. 4
755
Exhibit NZ-60: Dillon-Weston (1927), p. 5; Final IRA Report, Part B, p.135.
756
Exhibit NZ-60: Dillon-Weston (1927), pp. 5-6.
757
Exhibit AUS-53: Brook & Bailey (1965).
758
Exhibit AUS-53: Brook & Bailey (1965)
759
Final IRA Report, Part B, p. 135.
760
Exhibit AUS-60: Butler (1949); Exhibit AUS-38: Agrios (1997).
761
Final IRA Report, Part B, p. 136.
762
New Zealand’s first written submission, Annex 3, pp. 218-240.
754
201
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Australia’s climate modelling (Annex 2) indicates that the potential distribution of European
canker in Australia covers a much larger area than suggested by New Zealand’s climate analysis.
617.
In support of its unjustified criticism of the IRA Team’s exposure analysis New Zealand
mounts a series of subsidiary arguments which are dealt with in turn below.
a.
618.
The product at issue is not mature, symptomless apples
New Zealand repeatedly refers to “mature symptomless apples”.763
As previously
mentioned, any attempt by New Zealand to transform the product at issue in this dispute into
“mature symptomless apples” must be rejected by the Panel.
b.
619.
Fruit rot after removal from cold storage has been shown
New Zealand cites Biggs (1995)764 to argue that:
… the [Final IRA Report] fails to take into account the fact that not all latently
infected fruit would express symptoms (such as visible rot symptoms).
Symptomless fruit do not produce spores. Even if symptoms were to develop,
the IRA does not provide any evidence that conidia spores are produced from
storage rots or rots which develop after removal from cold storage from
latently infected fruit.765
620.
However, Australia has previously pointed out Biggs (1995)766 does not deal with
N. galligena and in this context is not entirely relevant. Further, infections in latently infected
fruit are often not manifest until after three to seven months in storage.767 When a latently
infected fruit expresses symptoms depends on the suitability of the conditions. In an infected
fruit (whether latent or not), the fungus is within the host tissue and it has the potential to resume
growth at any time given suitable conditions. For example, if an infected fruit sits on a waste
dump for long periods it is likely that at some stage there would be appropriate conditions for the
fungus to grow. Naturally infected fruit, partially buried in moist peat (similar to a waste dump),
New Zealand’s first written submission paras. 4.304, 4.305, 4.310, 4.312, & 4.317.
Exhibit NZ-62: Biggs (1995).
765
New Zealand first written submission, para. 4.305 (footnotes omitted); also, paras. 4.79, 4.81 & 4.82
(Article 2.2).
766
Exhibit NZ-62: Biggs (1995)
767
Exhibit NZ -9: Swinburne (1975): 794; Exhibit NZ-8: Snowdon (1990), p. 184; and Exhibit AUS-61:
Bondoux and Bulit (1959). See Final IRA Report, Part B, p. 122.
763
764
202
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Australia’s First Written Submission of Australia
18 July 2008
and left exposed outside during the winter, developed perithecia with mature asci in about three
months (Swinburne, 1964).768
621.
The Final IRA Report states that: “Neonectaria galligena can survive at temperatures
between 2°C and 30°C (Munson, 1939; Butler, 1949) and would readily tolerate cool storage
temperatures. The ability of this pathogen to survive low temperatures is a major reason for its
ability to infect even dormant trees (Marsh, 1940)”.769 Fruit rot after removal from cold storage
has been shown for cooking770 and dessert varieties.771 Given that conidia, and even ascospores,
are produced from apples rotting in the orchard772 there is no reason why rotting fruit coming out
of cold storage would not produce spores.
c.
622.
Spores can be dispersed from mummified apples on the ground
New Zealand alleges that:
… although [Munson (1939) and Grove (1990)] mention ascospore release
from canker infections in winter and spring, neither mentions production of
perithecia from rotted, mummified apples on the ground.773
623.
However, what New Zealand fails to acknowledge is that the production of perithecia
from rotted or mummified apples on the ground has been clearly demonstrated by other
studies774 and that some studies found mature ascospores in them.775 Ascospores are aerially
disseminated776 and are likely to be dispersed from mummified apples on the ground.
d.
New Zealand cannot seek to impose its own methodology on other
WTO Members
624.
New Zealand alleges that:
768
Exhibit NZ-11: Swinburne (1964) (Final IRA Report, p. 141).
Final IRA Report, Part B, p. 126. Exhibit NZ-37: Munson (1939); Exhibit AUS-60 Butler (1949);
Exhibit NZ-39: Marsh (1940).
770
Exhibit NZ-11: Swinburne, 1964
771
Exhibit AUS-56: Puia et al., 2004
772
Exhibit NZ-60: Dillon-Weston (1927)
773
New Zealand’s first written submission paras. 4.306, 4.312 & 4.316; also, para. 4.86 (Article 2.2).
774
Exhibit NZ-60: Dillon-Weston (1927) (Final IRA Report, Part B, p. 135); Exhibit NZ-11: Swinburne
(1964) (Final IRA Report, p. 135); and Exhibit NZ-10: McCartney (1967).
775
Exhibit NZ-60: Dillon-Weston (1927) (Final IRA Report, Part B, p. 135).
776
Exhibit NZ-64: Wilson (1966), p. 186.
769
203
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
… the proper inference to draw from [Swinburne (1964); McCartney (1967)
and Dillon-Weston 1927:5] would have been that development of ascospores
from mummified fruit is negligible, even under suitable conditions.777
625.
In arguing that there is a “proper inference to draw from [the scientific literature]”, New
Zealand highlights its misunderstanding of the appropriate standard of review under Article 5.1
of the SPS Agreement. In addition, New Zealand’s use of “negligible” here fails to recognise
that the SPS Agreement is not prescriptive as to methodology. New Zealand’s focus on the
qualitative descriptors and not the numbers is misplaced.
626.
In light of other requirements for successful transfer from a rotting fruit to a host, the IRA
Team assigned a lower exposure value778 than the “very low” that would have been accorded
solely on the basis of the Dillon-Weston (1927) finding that three out of 700 mummified fruit
produced perithecia with mature ascospores.779
e.
627.
Australian climatic conditions are conducive to European canker
Australia firmly rejects New Zealand’s assertion that the IRA Team’s “analysis of the
climate conditions conducive to infection both misconstrues the relevant literature and is
inconsistent with climatic information from countries where European canker is present.”780
N. galligena causes infection over a range of temperatures under field conditions.781 Grove
(1990: 36) has indicated that infections can occur between 5-16ºC, although the best range is
between 10-16ºC.782
Dubin and English (1974) and Grove (1990) have indicated that a
maximum of six hours’ wetness is sufficient to cause infections.783 These combinations could
give different results to those claimed by New Zealand.
628.
Nor does Australia accept that “the climatic conditions in Australia are not conducive to
European canker.”784 As previously indicated, the potential distribution of European canker in
New Zealand’s first written submission para. 4.307 (emphasis added); see, also paras. 4.310 & 4.317.
Final IRA Report, Part B, Table 12, p. 43.
779
Exhibit NZ-60: Dillon-Weston (1927), p. 5.
780
New Zealand’s first written submission para. 4.315 (footnote omitted); also, paras. 4.88-4.90 (Article
777
778
2.2).
781
Exhibit NZ-7: Grove (1990), p. 6.
Exhibit NZ-7: Grove (1990), p. 6.
783
Exhibit AUS-67: Dubin, H.J. and English, H. (1974) "Factors affecting apple leaf scar infection by
Nectria galligena conidia" Phytopathology 64, p. 1202; Exhibit NZ-7: Grove (1990), p. 36.
784
New Zealand’s first written submission para. 4.315; also para. 4.317; paras. 4.91-4.92 (Article 2.2).
782
204
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Australia covers a much larger area than suggested by New Zealand’s climate analysis
(Annex 2).
629.
In relation to ascospores specifically, New Zealand alleges that:
… production of ascospores is induced by low temperatures and is delayed by
dry conditions (Munson 1939: 455); both of these climatic factors mean that
under Australian conditions the likelihood of perithecia development and thus
ascospore production is negligible. This is confirmed by experience in the
Tasmanian European canker outbreak, where “mature asci were never found”
either on tree cankers or rotten fruit (Ransom 1997: 124). In some geographic
areas, ascospores play no role in the development of the disease (Annex 3, p.
224).785
630.
Australia rejects New Zealand’s allegation that under Australian conditions the likelihood
of perithecia development and thus ascospore production is “negligible” in accordance with New
Zealand’s view of the meaning of that term. Again, Australia does not accept New Zealand’s
characterisation of Australian climatic conditions. Annex 2 indicates that climatic conditions in
Australia are conducive to N. galligena establishment. Under Australian conditions, conidia and
ascospores would be produced.
631.
Australia notes that strains of N. galligena can be self-fertile (homothallic786), cross-
fertile (heterothallic787) or this characteristic may be variable.788
European strains of
N. galligena are generally self-fertile789 but they are sometimes cross-fertile.790
Evidence
suggests that some strains of N. galligena in North America are also cross-fertile.791
New Zealand’s first written submission para. 4.308 (emphasis added); also, paras. 4.92-4.94, 4.83 &
4.86 (Article 2.2).
786
A mycelium that produces two kinds of cells, which function as male and female.
787
Two forms of mycelia that interact as male and female in reproduction.
788
Exhibit AUS-68: Brayford, D., Honda, B.M., Mantiri, F.R. and Samuels G.J. (2004) “Neonectria and
Cylindrocarpon: the Nectria mammoidea group and species lacking microconidia” Mycologia 96(3), pp572–597;
Exhibit AUS-69: Hirooka Y., Kobayashi T., Natsuaki K.T. (2005) “Neonectria castaneicola and Neo. rugulosa in
Japan” Mycologia 97(5), 2005, pp. 1058–1066.
789
Exhibit AUS-70: Booth, C. (1959) Studies of Pyrenomycetes: IV Nectria (Part I), 30 December 1959,
CAB, pp. 48-51; Exhibit AUS-71: Lortie, M. (1964) “Pathogenisis in cankers caused by Nectria galligena”
Phytopathology 54, pp. 261-263; Exhibit AUS-72: Lacoste, L. and Dehorter, B. (1973) “Mycologie Determinisme
de la Reproduction Sexuee de Nectra Galligena Bres. in Vitro” Annales des Sciences Naturelles Botanique, Paris, 12
Serie, 1973, Tome 14, pp87-91; Exhibit AUS-73: El-Gholl, N.E., Barnard, E.L., and Schroeder, R.A. (1986)
“Homothallism in Neetria galligena”, Canadian Journal of Botony 64, pp. 902-903.
790
Exhibit AUS-74: Kruger, J. (1974) “Zur Genetik von Nectria galligena Bres”, Phytopathol, Z 79, pp.
320-342.
791
Exhibit AUS-75: Plante, F., Hamelin, R.C. and Bernier, L. (2002) “A comparative study of genetic
diversity of populations of Nectria galligena and N. coccinea var. faginata in North America”, Mycol. Res. 106, pp.
183-193.
785
205
Australia – Apples (DS367)
632.
Australia’s First Written Submission of Australia
18 July 2008
During the Tasmanian outbreak, N. galligena occurred on only four properties792 and is
not known to have established on hosts other than apple trees.
During this outbreak
protoperithecia793 were found on several occasions but they never contained asci or ascospores794
The absence of asci and ascospores strongly suggests that the Tasmanian strain of N. galligena
was a unique strain of N. galligena that required another mating type for sexual reproduction.
This is probably one of the reasons for the limited spread of the disease.795
f.
633.
Some surface spores survive desiccation
New Zealand alleges that:
Surface spores are short-lived because they are prone to desiccation without
continued moisture and would likely be dead well before arrival in
Australia.796
634.
Under Importation step 3, Australia has already shown that not all conidia present on fruit
are killed by desiccation.
g.
635.
Conidia can disperse from an infected apple on the ground
New Zealand alleges that:
Any dispersal of conidia would primarily be by rain splash and would likely
only be a few metres from a discarded apple [on the ground].797
636.
While rain splash is the primary means of conidia dispersal (Munson, 1939), conidia are
also dispersed by wind in the absence of rain (Swinburne, 1971b).798 Further, according to
Marsh (1940) the most probable maximum distance for dispersal by rain splash is ten metres.799
Accordingly, dispersal by “a few metres” is all that would be needed for a rotting apple in
792
Exhibit NZ-13: Ransom (1997).
Perithecia-like structures that do not form asci and ascospores.
794
Exhibit NZ-13: Ransom (1997).
795
Ascospores are required for long distance dissemination of the N. galligena: Exhibit AUS-76:
Swinburne, T.R. (1971b) “The seasonal release of spores of Nectria galligena from apple cankers in Northern
Ireland”, Annals of Applied Biology 69, pp. 97-104.
796
New Zealand’s first written submission para. 4.309; also, para. 4.67 (Article 2.2).
797
New Zealand’s first written submission paras. 4.311 & 4.316; also, para. 4.85 (Article 2.2).
798
Final IRA Report, Part B, p. 135; Exhibit NZ-37: Munson (1939); Exhibit NZ-9: Swinburne (1971b),
p. 98-99.
799
Final IRA Report, Part B, p. 135 Exhibit NZ-39: Marsh (1940).
793
206
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
orchard wholesaler waste, or in a backyard compost heap, to transfer to a susceptible host plant.
Australia notes that birds and insects are suspected as dispersal mechanisms of N. galligena.800
h.
637.
Laboratory studies are relevant
New Zealand argues that:
Where the IRA discusses host plant receptivity, it fails to acknowledge that
most infection studies are conducted under artificial conditions. For example,
the IRA quotes Wilson 1966 that infection of leaf scars can occur up to 4
weeks post-leaf fall. However, the IRA does not mention that this study was
done in laboratory climate chambers…801
638.
Australia rejects the inference that laboratory studies of pathogens are somehow
irrelevant to conducting a risk assessment. The IRA Team appropriately took into account
Wilson (1966)802 as part of its broader consideration of all the relevant scientific evidence. In
exercising its expert judgment the IRA Team considered the differences in the circumstances,
including whether particular studies were conducted under laboratory conditions.
i.
639.
Discarded apples can survive and develop rots
New Zealand alleges that:
… in the real world, a discarded apple would not survive three months in the
open air. Common sense dictates that other rots, birds, foraging insects,
marsupials and other mammals would consume the apple long before any rots
caused by N. galligena could develop. It is also worth noting that most
discarded fruit would have been consumed, leaving only the core. Such fruit is
unlikely to produce rots, as most of any infected portions would have been
eaten.803
640.
Australia does not accept New Zealand’s arguments for the following reasons. First, a
discarded apple could survive long enough in the “real world” to develop rot (particularly where
the rot had developed in storage). This is borne out by the fact that spore production on rotting
apples in orchards has been reported in both the United Kingdom804 and California.805 This
indicates, contrary to New Zealand’s assertion “other rots, birds, foraging insects, marsupials and
other mammals” did not consume these infected fruits before they could produce spores.
800
Final IRA Report, Part B, p. 136; Exhibit AUS-60: Butler (1949); Exhibit AUS-38: Agrios (1997)
New Zealand’s first written submission para. 4.313.
802
Exhibit: NZ-64: Wilson (1966)
803
New Zealand’s first written submission, para. 4.83 (Article 2.2).
804
Exhibit NZ-60: Dillon-Weston (1927).
805
Exhibit NZ-10: McCartney (1967).
801
207
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Secondly, New Zealand does not cite any evidence that other rots would develop faster than
European canker. Thirdly, New Zealand provides no evidence to support its claim that most fruit
would be consumed. Fourthly, not only the core of apples would be discarded and, in any event,
there could still be infection in the core. Puia et al. (2004) have detected N. galligena inside the
locules of the fruit (which are discarded with the core).806
j.
New Zealand misrepresents the threshold number of spores
required to initiate infection
641.
New Zealand asserts that:
… for infection to occur, the number of spores must be at or above a certain
threshold. Although the IRA acknowledges this, citing a figure of 1,000
conidia to initiate leaf scar infection, there is no connection between the
quantitative data from the literature cited and the ultimate assignment of
probability values for exposure.807
642.
New Zealand misrepresents the threshold infection figure of 1,000 conidia in the Final
IRA Report. The Final IRA Report indicates that “the number of conidia required to initiate an
infection varies depending on environmental and host factors”.808 It also notes that “in artificial
inoculations under optimal laboratory conditions as few as 10 or 12 conidia (McCraken et al.,
2003b; Cooke, 2003) have produced infections and these numbers resemble natural situations
(McCraken et al., 2003b)”.809 Further, the Final IRA Report notes “Dubin and English (1974)
found that five conidia were insufficient to initiate infection, while 50 to 500 did so readily.”810
643.
Further, Australia rejects New Zealand’s unsubstantiated assertion that there is no
connection between the literature cited and the IRA Team’s assignment of exposure values. All
the exposure values for N. galligena are set out in Table 33 of the Final IRA Report811 with an
806
Exhibit AUS-56: Puia et al (2004).
New Zealand’s first written submission para. 4.314; also para. 4.317.
808
Final IRA Report, Part B, p. 136 Exhibit AUS-77: McCracken, A.R., Berrie, A., Barbara, D.J., Locke,
T., Cooke, L.R., Phelps, K., Swinburne, T.R., Brown, A.E., Ellerker, B. and Langrell, S.R.H. (2003b) "Relative
significance of nursery infections and orchard inoculum in the development and spread of apple canker (Nectria
galligena) in young orchards" Plant Pathology 52 (5), pp553-566; Exhibit AUS-78: Cooke, L.R. (2003) "Nectria
galligena (European canker): Questions for Drs. A. Berrie & L. Cooke: Responses from Drs. L. Cooke & A.
McCracken" E-mail communication with Biosecurity Australia, pp3.
809
Final IRA Report, Part B, p. 136 Exhibit AUS-77: McCraken et al. (2003); Exhibit AUS-78: Cooke
(2003)
810
Final IRA Report, Part B, p. 136 Exhibit AUS-67: Dubin and English (1974).
811
Final IRA Report, Part B, p. 139.
807
208
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
accompanying explanation.812 Most of the exposure events have a “negligible” likelihood of
occurring, but some have a higher likelihood.813 For example, the combination of orchard
wholesaler waste and commercial fruit crops, as well as the combination of consumer waste and
household and garden plants. There are sound reasons for these higher exposure values and
these are set out in the Final IRA Report. The important point is that the IRA Team provided a
justification for all of the exposure values.814
ii.
644.
Summary on exposure
Australia has rebutted each of the arguments that New Zealand uses in support of its
claims against the IRA Team’s exposure analysis.
In doing so, Australia has clearly
demonstrated that the exposure values in the Final IRA Report are supported by scientific
evidence and are therefore based on probabilities not possibilities. Accordingly, Australia rejects
New Zealand’s assertion that the IRA Team “should have treated the likelihood of exposure in
all cases as negligible” in accordance with New Zealand’s view of the meaning of that term.815
New Zealand has failed to establish any flaws.
iii.
The IRA Team’s consideration of establishment and spread is based on
probabilities not possibilities
645.
The IRA Team assessed the probability of N. galligena establishing on a host plant, and
the probability of it spreading to other hosts. The probabilities of establishment and spread for
N. galligena are set out in Table 34 of the Final IRA Report816 with an accompanying
explanation of each rating.817 Apart from the likelihood of spread to wild and amenity plants, all
the scenarios described have a “moderate” or “high” likelihood of occurring.818
646.
New Zealand’s claims in relation to the IRA Team’s assessment of establishment and
spread are superficial.
New Zealand does not seriously address the issues raised in the
comprehensive discussion of establishment and spread for N. galligena in the Final IRA
812
Final IRA Report, Part B, pp. 137-138.
Final IRA Report, Part B, Tables 12 & 33, pp. 43 & 139.
814
Final IRA Report, Part B, pp. 137-138.
815
New Zealand’s first written submission, para. 4.317. (emphasis added)
816
Final IRA Report, Part B, p. 144.
817
Final IRA Report, Part B, pp. 142-144.
818
Final IRA Report, Part B, Tables 12 & 34, pp. 43 & 144.
813
209
Australia – Apples (DS367)
Report.819
Australia’s First Written Submission of Australia
18 July 2008
Australia rejects the thrust of New Zealand’s complaint that the IRA Team’s
“conclusions [on the likelihood of establishment and spread] are not supported by scientific
evidence.”820
647.
In respect of establishment and spread, New Zealand raises arguments on: (a) alternative
hosts; (b) Australian climatic conditions; (c) the Tasmanian outbreak; and (d) the international
trade in apples. Australia will rebut each of these arguments in turn. In doing so, Australia will
demonstrate that the IRA Team’s conclusions are supported by scientific evidence and are based
on probabilities not possibilities.
a.
N. galligena affects alternative hosts in New Zealand and
elsewhere
648.
New Zealand asserts that:
The IRA relies on alternative hosts of N. galligena … in support of its
contention for the likelihood of establishment and spread of European canker.
However, the IRA’s consideration of alternative hosts for N. galligena relates
to northern hemisphere hardwood forest (deciduous) trees (e.g. Birch, Beech,
Oak, Elm and Maple). N. galligena is considered native to North America
(Castlebury et al. 2006:1431). It has co-evolved with these northern
hemisphere hosts (Flack and Swinburne 1977) in their associated climate,
which is typified by moderate temperatures and distribution of rainfall over the
year (see Annex 3, p. 225). It does not necessarily follow that N. galligena
will cause disease in these hosts in New Zealand and Australia where climatic
conditions are considerably different (see Annex 3, p. 225).821
649.
It is disingenuous for New Zealand to suggest that research from the United Kingdom822,
Northern Europe and Nova Scotia823 in relation to Northern Hemisphere trees as alternative hosts
is irrelevant. Australia reiterates that, given that it is currently free from N. galligena, the IRA
Team had no option but to consider studies from other countries with the disease when assessing
establishment and spread. Australia emphasises that in exercising its judgment the IRA Team
took into account differences in the circumstances.
819
Final IRA Report, Part B, pp. 139-144.
New Zealand’s first written submission, para. 4.324.
821
New Zealand’s first written submission, para. 4.318 (footnotes omitted; emphasis added); also, para.
4.320; para. 4.87 (Article 2.2).
822
Exhibit NZ-66: Flack and Swinburne (1977).
823
Exhibit AUS-79: Braun, P.G. (1997) "Distribution and severity of anthracnose canker and European
canker of apple in Kings Country, Nova Scotia" Canadian Journal of Plant Pathology 19, pp78-82.
820
210
Australia – Apples (DS367)
650.
Australia’s First Written Submission of Australia
18 July 2008
Australia does not accept that Australian climatic conditions are unsuitable for the
establishment and spread of N. galligena (Annex 2).
In any event, North America, New
Zealand, Northern Europe, the United Kingdom and Australia all have similar temperate climate
regions and common plant species that are hosts to N. galligena. Given time and opportunity
(i.e. without control and eradication) the fungus would establish on alternative hosts in these
countries. In New Zealand, the fungus has been collected from plant species such as loquat,
coprosma and kowhai.824 Further, evidence shows that the N. galligena causes considerable
damage to trees in private gardens in New Zealand.825
651.
New Zealand’s assertion that “[i]ncluding other hosts in arguments about risk of
establishment and spread in Australia from New Zealand apples is therefore misleading” 826 is
curious given that ISPM No. 11 identifies this as the first criterion to consider in estimating the
probability of establishment.827
652.
In addition, New Zealand alleges that:
In New Zealand there is no evidence of European canker causing pathogenic
symptoms in other host plants. The IRA acknowledges that while there are
records of N. galligena occurring on hosts other than apple or pear trees, “there
is no information in the literature indicating these species are hosts…and there
is no evidence that the disease has become established on these species”.828
653.
New Zealand’s allegation seems inconsistent with evidence which shows that
N. galligena causes considerable damage to trees in private gardens in New Zealand.829
654.
New Zealand also argues that:
It is notable that European canker did not spread to alternative hosts in
Spreyton, Tasmania, despite the disease being present in apple orchards there
for several decades.830
655.
In Australia’s view, there was a combination of factors as to why the disease did not
spread to alternative hosts during the Tasmanian outbreak. These factors are dealt with below.
824
Exhibit AUS-80: Manaaki Whenua Landcare Research, NZFUNGI - New Zealand Fungi (and
Bacteria): Collection details for PDD 31850, 32629, 32509, 32502, 32495, 30639 and 32679. All available from:
http://nzfungi.landcareresearch.co.nz/html/data_collections.asp?ID=&NAMEPKey=12911
825
Exhibit AUS-52: Atkinson (1971).
826
New Zealand’s first written submission, para. 4.320.
827
Exhibit AUS-6: ISPM No. 11, sections 2.2.2 & 2.2.2.1.
828
New Zealand’s first written submission, para. 4.319. (footnote omitted)
829
Exhibit AUS-52: Atkinson (1971); Final IRA Report, Part B, p. 146.
830
New Zealand’s first written submission, para. 4.320; also para. 4.323; para. 4.93 (Article 2.2).
211
Australia – Apples (DS367)
b.
656.
Australia’s First Written Submission of Australia
18 July 2008
Australian climatic conditions are conducive to European canker
New Zealand’s general allegation is that Australian climatic conditions are not suitable
for the establishment and spread of European canker.831 In particular, New Zealand asserts that:
… in seeking to substantiate its argument that European canker could establish
and spread in Australia the IRA comments that “Australia has areas with
similar environments to these countries [the USA, Europe and New Zealand]”.
However, as pointed out in Annex 3, climatic conditions are in fact quite
different, especially between Australian apple production areas and areas in the
USA, the United Kingdom and Northern Europe where European canker is
prevalent.832
657.
Australia considers that New Zealand’s climate analysis833 is too narrow. In Australia’s
view, the potential distribution of European canker in Australia covers a much larger area than
suggested by New Zealand (Annex 2). Accordingly, the general statement in the Final IRA
Report that “Australia has areas with similar environments to these countries”834 is appropriate.
658.
Further, New Zealand argues that:
It is significant that while the Tasmanian climatic conditions are unfavourable
for European canker (which the IRA acknowledges as one reason behind the
limited spread during the outbreak), the conditions in Northern Tasmania
where the outbreak occurred are comparatively more conducive to European
canker than other parts of Australia (Annex 3, p. 225).835
659.
This argument has no merit. Australia’s climate modelling (Annex 2) demonstrates that,
in addition to Tasmania, there are a large number of areas in Australia which are conducive to
establishment of European canker.
c.
There are a range of reasons for the limited scope of the
Tasmanian outbreak
660.
In relation to the Tasmanian outbreak of European canker New Zealand alleges that:
… the IRA overestimates the significance of the eradication program when it
claims that one reason European canker did not spread far “can be attributed to
New Zealand’s first written submission, para. 4.320 & 4.323; also, paras. 4.91-4.92 (Article 2.2).
New Zealand’s first written submission, para. 4.321 (footnote omitted; emphasis added); also,
paras. 4.57, 4.58, 4.73 & 4.87 (Article 2.2).
833
New Zealand first written submission, Annex 3, pp. 218-240.
834
Final IRA Report, Part B, p. 141.
835
New Zealand’s first written submission, para. 4.323 (footnote omitted); also, paras. 4.91-4.92 (Article
2.2).
831
832
212
Australia – Apples (DS367)
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18 July 2008
the eradication programme which began within two years of confirmation of
the disease (Ransom 1997)”. It fails to take into account that the disease was
probably present for more than 20 years before the eradication program began
(Ransom 1997: 121).836
661.
The IRA Team did not overestimate the significance of the eradication program.
N. galligena was identified in three orchards, on two Spreyton properties in 1954. The initial
source of infection was unknown.837
662.
At the commencement of the eradication program in 1954-55, six orchard blocks within
four orchards were affected by the disease.
Two of these blocks were severely infected
indicating that conditions were conducive for the disease.
Researchers in Tasmania had
observed collapse of diseased wood after infection and suggested that the disease would have
established in the region if not controlled. The disease was not detected outside of these infected
orchard blocks.
663.
The eradication program, as described in Ransom (1997), involved stringent measures
including regular inspection, spraying with fungicides, removal of limbs, and removal and
burning of more than 200 trees.838 Any suggestion that this rigorous eradication program was
somehow irrelevant to restricting the spread of the disease lacks credibility. The final survey,
carried out in 1991, confirmed the absence of N. galligena, although there was evidence that
disease spread had stopped by 1978.
664.
Another important factor in relation to the scope of the Tasmanian outbreak was that
conidia were the only mechanism for disease spread, in the absence of sexually produced
ascospores. Conidia are dispersed mainly by rain splash839 and the maximum distance to which
these spores can spread under normal circumstance is ten metres (Taylor and Byrde, 1954).840
Ascospores are better adapted to long-distance dispersal than conidia.841 These factors were also
likely to have contributed significantly to the limited spread of N. galligena in Tasmania.842 In
addition, as described above, Australia considers that the Tasmanian outbreak was likely to have
been a unique strain of N. galligena that required another mating type for reproduction.
New Zealand’s first written submission, para. 4.322 (footnote omitted); also, para. 4.93 (Article 2.2).
Exhibit NZ-13: Ransom (1997).
838
Exhibit NZ-13: Ransom (1997), p. 121; Final IRA Report p. 146.
839
Exhibit NZ-7: Grove (1990a).
840
Exhibit NZ-40: Taylor and Byrde (1954)
841
Exhibit AUS-76: Swinburne (1971b)
842
Exhibit NZ-13: Ransom (1997).
836
837
213
Australia – Apples (DS367)
665.
Australia’s First Written Submission of Australia
18 July 2008
Further, Australia emphasizes that Ransom 1997 merely states that the disease “may”
have been present for almost 20 years but does not provide any information to support this
suggestion.843 In addition, Ransom 1997 states that the eradication program began immediately
after the proper identification of the disease.844
666.
New Zealand also alleges that:
… the primary reasons European canker did not spread into other apple
growing regions or alternative hosts within Tasmania or onto the Australian
mainland during the outbreak, despite unrestricted movement of fruit from the
affected orchards, is that fruit are not a pathway for the disease under New
Zealand and Australian conditions … 845
667.
New Zealand points out, as acknowledged in the Final IRA Report, 846 that during the
period of the Tasmanian outbreak, there were no restrictions on the movement of apple fruit.
However, New Zealand then misrepresents the nature of interstate trade in apples at the time.847
While there may have been significant interstate trade in Tasmanian apples during the outbreak,
this does not equate to a significant interstate trade in Spreyton apples.848
668.
Australia’s view is borne out by the unverified data which New Zealand has produced on
Spreyton apple production.849 According to this data, each year during the period 1970-1976, an
average of 151 tonnes of Spreyton apples were shipped to the mainland – that is less than 0.04%
of annual production in Spreyton. It is also worth noting that fruit infection was not reported
during the Tasmanian outbreak.
669.
Therefore, the Tasmanian outbreak is not probative as to the suitability of the climate of
the Australian mainland for the establishment and spread of N. galligena. Moreover, the fact
that during the Tasmanian outbreak some trees were severely infected indicates that climatic
conditions were suitable. This is confirmed by Australia’s Annex 2.
843
Exhibit NZ-13: Ransom (1997), p. 121.
Exhibit NZ-13: Ransom (1997), p. 122.
845
New Zealand’s first written submission, para. 4.323 (footnotes omitted; emphasis added); also, paras.
4.52, 4.53, 4.77, 4.84, 4.94, 4.95, 4.96, 4.97, 4.98, 4.99, 4.100, 4.104 & 4.105 (Article 2.2).
846
Final IRA Report, Part B, p. 155.
847
New Zealand’s first written submission, para. 4.94 (Article 2.2).
848
Final IRA Report, Part B, p. 155
849
New Zealand’s first written submission, Annex 5, Table 4, p. 249. Australia has been unable to verify
the accuracy of the data contained in Table 4 and would be grateful if New Zealand could provide copies of the
relevant production cards from Tasmanian Archives.
844
214
Australia – Apples (DS367)
670.
Australia’s First Written Submission of Australia
18 July 2008
Finally, New Zealand’s assertion that “fruit are not a pathway for the disease” is
inconsistent with an explicit statement to the contrary by the Chief Plants Officer of the New
Zealand Ministry of Agriculture.850
d.
New Zealand’s claim regarding the international trade in apples is
hollow
671.
New Zealand’s claim851 that the export trade over the last 15 years provides no evidence
for spread of European canker is hollow, given that the vast majority of New Zealand’s exports
have been to countries that already have the disease.
iv.
672.
Summary on establishment and spread
New Zealand’s language about “speculation” and “the remotest of possibilities”852 cannot
remedy its failure to meet its burden of proof in relation to the establishment and spread of
European canker. Australia submits that New Zealand has failed to identify any flaws in the IRA
Team’s assessment of establishment and spread, let alone any flaws serious enough to prevent
the Panel from having “reasonable confidence” in the risk assessment.
(c)
The IRA Team’s analysis of the potential consequences of European canker
is objective and credible
673.
New Zealand’s claims in respect of the consequences of N. galligena are both superficial
and confused. New Zealand does not seriously address the issues raised in the comprehensive
discussion on consequences contained in the Final IRA Report.853 The crux of New Zealand’s
claims is that “the IRA’s assessment of the overall consequences [of N. galligena] as moderate is
a significant overestimation.”854
674.
In terms of the direct impact of N. galligena, New Zealand appears to be challenging the
IRA Team’s conclusion about the following: (a) plant life or health; and (b) other aspects of the
environment. In terms of the indirect impact, New Zealand appears to challenge the IRA Team’s
850
Exhibit AUS-54: Ivess (1996).
New Zealand’s first written submission, para. 4.95 (Article 2.2).
852
New Zealand’s first written submission, para. 4.325.
853
Final IRA Report, Part B, pp. 145-150.
854
New Zealand first written submission, para. 4.332.
851
215
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18 July 2008
conclusions about the following: (a) control and eradication; (b) international trade; (c)
environment; and (d) communities.
i.
675.
Direct impact
New Zealand alleges that “[t]he IRA’s rating for the direct impact of European canker is
… a significant overestimate.”855 New Zealand misunderstands the assessment of consequences,
as there is no single rating for the direct impact; there are only ratings for individual direct
impact criteria. In any event, Australia will demonstrate below that the rating assigned to each
of the relevant direct impact criteria by the IRA Team was credible.
a.
676.
Plant life or health
The IRA Team considered that the direct consequences on plant life would be minor at
the national level, significant at the regional level and highly significant at the district level, as
explained in the Final IRA Report.856
677.
New Zealand argues that:
The IRA asserts that the Australian climate is favourable for European canker
development based on its climatic comparisons with other parts of the world
where European canker exists … New Zealand has shown that the IRA vastly
overestimates the risk of establishment or spread of European canker in
Australia …857
678.
The Final IRA Report does not baldly assert that “the Australian climate is favourable to
European Canker development”. Rather it states that: “[c]limatic conditions in approximately
40% of Australian commercial fruit growing areas are conducive to infection. The Adelaide
hills, Perth and Manjimup areas have annual mean rainfalls greater than 1000 mm, and Orange
and Batlow in New South Wales have annual mean rainfalls close to 1000mm.”858
679.
Australia has already demonstrated that the IRA Team’s analysis is a credible evaluation
of the likelihood of the establishment or spread of European canker. Accordingly, Australia
New Zealand’s first written submission, para. 4.326; see, also para. 4.329.
Final IRA Report, Part B, pp. 146-147.
857
New Zealand’s first written submission, para. 4.326.
858
Final IRA Report, Part B, p. 146.
855
856
216
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18 July 2008
rejects New Zealand’s allegation that “the IRA vastly overestimates the [likelihood] of
establishment or spread of European canker in Australia”.859
680.
New Zealand goes on to argue that:
All of the IRA’s examples of serious impacts of European canker apply only to
the cool temperate conditions of Europe and North America and to the plants
and apple varieties commonly grown there, rather than to Australian
conditions. The climate data provided by New Zealand [Annex 3] suggests
that the direct impact of European canker on plant life or health in Australia
would be at most minor, even at the local level. 860
681.
Australia considers that New Zealand’s climate analysis861 is too narrow to accurately
predict the establishment of European canker. Australia’s modelling (Annex 2) indicates that the
potential distribution of European canker in Australia covers a much larger area than suggested
by New Zealand’s climate analysis, showing that the direct impact of European canker on plant
life or health in Australia would be more than “minor”, even at the local level.
682.
Further, it is incorrect to infer that all of the examples in the Final IRA Report, regarding
the “serious impacts” to plant life or health, only relate to Europe and North America and to the
plants and apple varieties grown there. The Final IRA Report also cites material dealing with
both Tasmania862 and New Zealand863 which indicates that the disease, where established, has
serious consequences.
In Chile, another Southern Hemisphere country, the disease, where
established, has become critical causing high incidence and high severity.864 In any event, given
that Australia is currently free from N. galligena, in assessing consequences the IRA Team had
no option but to draw on the experiences of other countries with the disease.
683.
In addition, some popular varieties grown in Europe and North America are similar to
those grown in Australia and New Zealand, so New Zealand’s claim in regard to differences in
varieties is wrong.865
859
New Zealand first written submission, para. 4.326.
New Zealand first written submission, para. 4.327; also, para. 4.329.
861
New Zealand first written submission, Annex 3, pp. 218-240.
862
Exhibit NZ-13: Ransome (1997).
863
Exhibit AUS-52: Atkinson (1971). See also Exhibit AUS-53: Brook and Bailey (1965)
864
Exhibit AUS-81: Lolas, M. and Latorre, B.A. (1996) “Importancia y control del cancro europeo del
manzano” Rev.Fruiticola (Chile) 17, pp23-27 (English translation also included); Exhibit AUS-65: Lolas and
Latorre (1997).
865
Exhibit AUS-21: Innomarc (2006).
860
217
Australia – Apples (DS367)
684.
Australia’s First Written Submission of Australia
18 July 2008
Recent reports coming out of New Zealand support the IRA Team’s rating of the direct
impact of N. galligena on plant life or health. For example, the Hawke’s Bay Emergency
Management Group considers European canker to be one of the diseases that can cause severe
damage and production losses in that area.866 Another example is the Auckland and Waikato
areas where N. galligena has had a significant impact on plants in apple orchards and nurseries
for many years867 and has acted as a source of spread to other areas like Nelson. Both these
examples support the IRA Team’s assessment of consequences.
685.
Finally, New Zealand ignores the fact that the IRA Team considered that there were a
large number of other host species of N. galligena, in addition to apples and pears.868
686.
In the preceding paragraphs, Australia has rebutted each of New Zealand’s arguments in
respect of the direct impact of N. galligena on plant life or health. In doing so, Australia has
demonstrated that the rating assigned to this criterion by the IRA Team was credible.
b.
687.
Other aspects of the environment
The IRA Team considered that the direct consequences on other aspects of the
environment would be minor at the regional level, significant at the district level and highly
significant locally, as explained in the Final IRA Report.869
688.
New Zealand alleges that:
Relying on data from areas where climate and flora are significantly different
from most parts of Australia, [the Final IRA Report] concludes that European
canker could establish and spread in many parts of the country, ignoring the
actual experience from the Tasmanian outbreak. The IRA states “the most
likely reason why the disease did not spread to environmental species in
Spreyton is because of the eradication program …”. But this eradication
programme began in 1954, more than 20 years after the probable establishment
866
Exhibit AUS-82: Hawkes Bay Emergency Management Group, Pest or Diseases affecting Agriculture,
Forestry or Horticulture. Website:
http://www.hbemergency.govt.nz/Search/SearchResult_IDL=6_IDT=496_ID=1837_.html
867
Exhibit AUS-83: Hortwatch (2002) Post-harvest Clean Up Sprays. Website:
http://www.hortwatch.com/library/post-harvest-clean.html
868
Final IRA Report, Part B, pp. 117, 146-147; Exhibit AUS-84: Commonwealth Agricultural Bureaux
International (2003) Crop Protection Compendium - Global Module, CAB International.
869
Final IRA Report, Part B, pp. 147-148.
218
Australia – Apples (DS367)
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18 July 2008
of the disease in Spreyton, and continued until 1978, with eradication declared
in 1991 (Ransom 1997).870
689.
Australia has already demonstrated that the IRA Team’s analysis of the probability of
establishment and spread of European canker is a credible evaluation of the likelihood of the
establishment and spread of the disease. Given that Australia is free from N. galligena, the IRA
Team had to consider studies from other countries with the disease. Australia again emphasises
that in exercising its expert judgment the IRA Team took into account differences in the
circumstances between Australia and other countries, including climate and flora.
690.
Australia rejects New Zealand’s allegation the IRA Team ignored the “actual experience”
from the outbreak of European canker in Tasmania. Ransom (1997) merely states that the
disease “may” have been present for almost 20 years but does not provide any information to
support this suggestion.871 In addition, Ransom (1997) states that the eradication program began
immediately after the proper identification of the disease.872 The Tasmanian eradication program
involved stringent measures including regular inspection, spraying, removal of limbs, and
removal and burning of more than 200 trees.873 It is disingenuous for New Zealand to argue that
this rigorous eradication program was somehow irrelevant to restricting the spread of the disease.
691.
The limited spread of N. galligena in Tasmania was also assisted by the absence of
airborne ascospores874 which are better suited to long-distance dispersal than conidia. The New
Zealand strain of N. galligena produces ascospores875 and therefore if it established in Australia
the impact would be much more severe than in Tasmania. Even in the absence of ascospores,
limited spread among apple trees within and between orchards in Tasmania occurred through
rain splashed conidia.876 In addition, as described above, Australia considers that the Tasmanian
outbreak was likely to have involved an unique strain of N. galligena that required another
mating type for reproduction.
692.
New Zealand also asserts that:
870
New Zealand first written submission, para. 4.328. (footnote omitted)
Exhibit NZ-13: Ransom (1997), p. 121.
872
Exhibit NZ-13: Ransom (1997), p. 122.
873
Exhibit NZ-13: Ransom (1997), p. 121; Final IRA Report, Part B, p. 146.
874
Exhibit NZ-13: Ransom (1997), p. 124.
875
Exhibit AUS-53: Brook & Bailey (1965).
876
Exhibit NZ-13: Ransom (1997), p. 124.
871
219
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
N. galligena is not known worldwide to cause damaging diseases of amenity
plants. For example, when the disease occurred in Tasmania, there were no
reports of it affecting forest, household or garden plants (Ransom 1997).877
693.
New Zealand’s assertion that N. galligena does not impact on amenity plants is wrong.
Evidence shows that the disease causes considerable damage to trees in private gardens in New
Zealand.878 In addition, it is well accepted that common hosts of the fungus include maple,
birch, beech, ash, oak, willow and elm trees.879 New Zealand itself concedes that beech, birch,
elm, maple and oak trees are “primary hosts”.880 Many of these trees are amenity plants in
Australia.881 The Final IRA Report notes that N. galligena is responsible for damage to many
non-rosaceous hosts including those used for timber.882 Further, the Final IRA Report indicates
that the most likely reason why the disease did not spread to forest, household or garden plants
during the Tasmanian outbreak is because of the rigorous eradication program.883 Australia has
already set out a number of other reasons why the Tasmanian outbreak was limited.
694.
Australia has rebutted each of New Zealand’s arguments in respect of the direct impact of
N. galligena on other aspects of the environment. In doing so, Australia has demonstrated that
the rating assigned to this criterion by the IRA Team was credible.
ii.
695.
Indirect impact
New Zealand alleges that “[t]he IRA’s approach to the analysis of indirect impact of
European canker exaggerates the predicted overall effect that European canker would have on
Australia.”884
Australia rejects this allegation and will demonstrate below that the rating
assigned to each of the relevant indirect impact criteria by the IRA Team was credible.
New Zealand’s first written submission, para. 4.330.
Exhibit AUS-52: Atkinson (1971).
879
Final IRA Report, Part B, p. 117. Exhibit AUS-84: CABI (2003).
880
New Zealand’s first written submission, para. 3.56.
881
Final IRA Report, Part B, p. 147.
882
Final IRA Report, Part B, p. 146. Exhibit NZ-66: Flack and Swinburne (1977).
883
Final IRA Report, Part B, pp. 147-148.
884
New Zealand’s first written submission, para. 4.330.
877
878
220
Australia – Apples (DS367)
a.
696.
Australia’s First Written Submission of Australia
18 July 2008
Control and eradication
As explained in the Final IRA Report, the indirect impact of control and eradication
would be minor at the regional level, significant at the district level and highly significant
locally.885
697.
New Zealand alleges that:
… climate data presented by New Zealand [Annex 3] suggests that any
outbreak is likely to be highly localised, as in Tasmania where only six
orchards were affected in a 40-plus year period (Ransom 1997: 121).
Consequently, the costs of eradication are not likely to be high. Experience in
New Zealand suggests that routine orchard control of the disease is possible as
part of routine controls of other apple diseases already present in Australia,
such as apple scab.886
698.
Australia considers New Zealand’s climate analysis887 to be too narrow. Australia’s
climate modelling (Annex 2) indicates that the potential distribution of European canker in
Australia covers a much larger area than suggested by New Zealand. Accordingly, Australia
does not accept that “any outbreak [of N. galligena] is likely to be highly localised”.
699.
Further, Australia rejects New Zealand’s attempt to downplay the costs of eradication.
European canker is both difficult and expensive to eradicate once established.888 Australia and
the Republic of Korea are the only countries which have been able to eradicate it. Even in
Tasmania where the outbreak was restricted to four orchards, the eradication process took nearly
40 years. General control methods for European canker include fungicide sprays, paints applied
to pruning cuts, cultural control, improving host plant resistance and the prevention of fruit
rot.889 Implementing these measures would be costly.
700.
The Final IRA Report acknowledges that “cultural practices and chemical measures used
to control apple scab … in most Australian apple growing regions (except Western Australia)
would assist in controlling European canker”.890
However it goes on to note that “spray
treatments alone cannot eradicate existing infections and must be supplemented by removing
885
Final IRA Report, Part B, p. 148.
New Zealand first written submission, para. 4.331.
887
New Zealand first written submission, Annex 3, pp. 218-240.
888
Final IRA Report, Part B, p. 148.
889
Exhibit AUS-84: CABI (2003).
890
Final IRA Report, Part B, p. 148. (emphasis added)
886
221
Australia – Apples (DS367)
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18 July 2008
cankers and treating wounds with an effective paint”.891
Notwithstanding routine orchard
controls for apple scab in New Zealand, European canker is still spreading.
701.
The outbreak of European canker in Tasmania usefully illustrates the appropriateness of
the IRA Team’s rating for the indirect impact of control and eradication: it had no impact
nationally, a minor impact in Tasmania, a significant impact on Spreyton, and a highly
significant impact on the affected orchards. This is exactly the same rating that the IRA Team
gave to the indirect impact for control and eradication should European canker become
established through the importation of New Zealand apples.
702.
Australia has rebutted each of New Zealand’s arguments in respect of the indirect impact
of control and eradication. In doing so, Australia has demonstrated that the rating assigned to
this criterion by the IRA Team is credible.
b.
703.
International trade
As explained in the Final IRA Report, the indirect consequences on international trade
would be minor locally.892
704.
New Zealand makes the unsubstantiated assertion that:
With regard to international trade, New Zealand’s experience is that the
presence of N. galligena has not constrained its trade in apples, with countries
other than Australia.893
705.
New Zealand presupposes that Australia’s export markets are exactly the same as New
Zealand’s. Australia notes that New Zealand’s major export markets already have European
canker. New Zealand has failed to substantiate its claim, and therefore there is no basis for
questioning the rating assigned by the IRA Team.
891
Final IRA Report, Part B, p. 148; Exhibit AUS-85: Cooke, L.R. (1999) "The influence of fungicide
sprays on infection of apple cv. Bramley's seedling by Nectria galligena" European Journal of Plant Pathology 105,
pp783-790.
892
Final IRA Report, Part B, p. 149.
893
New Zealand’s first written submission, para. 4.332.
222
Australia – Apples (DS367)
c.
706.
Australia’s First Written Submission of Australia
18 July 2008
Environment
As explained in the Final IRA Report, the indirect consequences on the environment
would be minor at the district level and significant at the local level. The Final IRA Report
provides a transparent explanation of this rating.894
707.
New Zealand makes the unsubstantiated assertion that:
… the experience of Tasmania, New Zealand and all other apple-producing
countries where N. galligena is or has been present, shows that its impact on
the environment … is negligible.895
708.
New Zealand’s reference to a “negligible” impact on the environment ignores the
methodology used by the IRA Team in the assessment of consequences. This is yet another
example of New Zealand attempting to conduct its own risk assessment according to its own
methodology. The SPS Agreement is not prescriptive as to methodology.
709.
The IRA Team considered that establishment of N. galligena in Australia “could
necessitate increased chemical usage in some situations and this may have undesirable effects on
the local environment as well as significantly impacting on the future placement of plant species
(for example, elm trees) at the local level.”896
In fact, this is usefully illustrated by the
Tasmanian outbreak described in Ransom (1997)897 during which the quarantining of the area
and the use of mercury-based and copper-based fungicides had a minor district level impact and
significant local/orchard level impact on the environment indirectly.
710.
Australia has rebutted New Zealand’s arguments in respect of the indirect impact on the
environment. In doing so, Australia has demonstrated that the rating assigned to this criterion by
the IRA Team was credible.
894
Final IRA Report, Part B, p. 149.
New Zealand’s first written submission, para. 4.332. (emphasis added)
896
Final IRA Report, Part B, p. 149.
897
Exhibit NZ-13: Ransom (1997), p. 124.
895
223
Australia – Apples (DS367)
d.
711.
Australia’s First Written Submission of Australia
18 July 2008
Communities
As explained in the Final IRA Report, the indirect consequences would be of minor
significance at the district level and significant at the local level.898
712.
New Zealand makes the unsubstantiated assertion that:
… the experience of Tasmania, New Zealand and all other apple-producing
countries where N. galligena is or has been present, shows that its impact on
… communities is negligible. In particular, there is no basis for the IRA’s
suggestion that European canker disease in the elm tree population of
Melbourne could have indirect flow-on effects for tourism.899
713.
Again, New Zealand’s reference to a “negligible” impact on the environment ignores the
methodology used by the IRA Team in the assessment of consequences. Again, Australia
emphasises that New Zealand is not entitled to impose its methodology on Australia.
714.
The Final IRA Report states that:
Sustainability of communities in the nine or so major apple growing areas
across Australia is significant to the local economy. Tourism in these areas,
especially during harvesting periods, can be significant and depends on the
health of the fruit crop. In the event of establishment and spread of the disease
in Melbourne’s elm tree population, there could be indirect significant flow-on
effects for tourism. There could be significant social impacts at a local level if
several orchards were affected by European canker, owing to reduced crop
yields and potential quarantine restrictions.
715.
Again, the position is usefully illustrated by the Tasmanian outbreak described in
Ransom (1997)900 during which the quarantining of the area, effects on the livelihood of local
people, and effects on tourism had a minor district level impact and significant local/orchard
level impact on the community indirectly.
716.
Finally, New Zealand’s complaint regarding the indirect impact on tourism of European
Canker establishment in the elm tree population of Melbourne is misguided. The City of
Melbourne values its street and park trees at a total of A$500 million, an average of A$10,000
per tree.901 Melbourne has 6,300 elm trees. Stands of Dutch and English elms are integral parts
898
Final IRA Report, Part B, p. 150.
New Zealand’s first written submission, para. 4.332. (footnote omitted)
900
Exhibit NZ-13: Ransom (1997).
901
Exhibit AUS-86: City of Melbourne (2005) "Tree management/replacement program, impact and
implications" Planning and Environment Committee Report, 31 May 2005:
http://www.melbourne.vic.gov.au/opm/bc/CTEE/meetings/PaE_53_20050531.pdf.
899
224
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18 July 2008
of the World Heritage listed Royal Exhibition Building and Carlton Gardens site.902 Sites such
as Carlton Gardens and other city parks are likely to be important to tourism in Melbourne.
717.
Australia has rebutted New Zealand’s arguments in respect of the indirect impact of
communities. In doing so, Australia has demonstrated that the rating assigned to this criterion by
the IRA Team is credible.
iii.
718.
Summary on consequences
New Zealand’s language about “exaggeration”903 and “significant overestimation”904
cannot remedy its failure to meet its burden of proof in relation the assessment of consequences
for European canker. Australia submits that New Zealand has failed to establish any flaws with
the IRA Team’s assessment of consequences.
(d)
Conclusion: New Zealand fails to discredit the IRA Team’s assessment on
European canker
719.
Australia submits that the IRA Team properly evaluated the likelihood of entry,
establishment and spread of European canker, as well as the potential biological and economic
consequences. New Zealand has therefore failed to demonstrate any flaws in the Final IRA
Report, let alone flaws that were “so serious” that it should prevent the Panel from having
reasonable confidence in the evaluation made. In any event, Australia has demonstrated that the
IRA Team properly evaluated risk and applied its expert judgment rigorously to arrive at an
objective and credible assessment for European canker. Accordingly, the risk assessment is
consistent with Article 5.1 of the SPS Agreement.
902
Exhibit AUS-87: National Trust (2008), Royal Exhibition Building:
http://www.nattrust.com.au/trust_register/search_the_register/royal_exhibition_building
903
New Zealand’s first written submission, para. 4.330.
904
New Zealand’s first written submission, paras. 4.326, 4.329, 4.332.
225
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
5.
Apple leafcurling midge
720.
New Zealand challenges the IRA Team’s risk assessment in respect of ALCM, claiming
that:
The IRA has failed to evaluate the “likelihood” of entry, establishment and
spread of ALCM, as well as the potential biological and economic
consequences within the meaning of paragraph 4 of Annex A. Accordingly,
Australia has failed to comply with its obligations under Article 5.1 of the SPS
Agreement.905
721.
In respect of Article 2.2, New Zealand claims that “[t]he Australian contention … that
mature, symptomless apples provide a pathway for the transmission and establishment of ALCM
… is not supported by scientific evidence.”906
722.
Australia submits that New Zealand has failed to identify any flaws in the risk assessment
for ALCM, let alone any flaws serious enough to prevent the Panel from having “reasonable
confidence” in the risk assessment.907 New Zealand consistently fails to appreciate the range in
the scientific data available in respect of the probability of particular events occurring, and has
repeatedly tried to limit a probability to a single value based on a single piece of evidence,
without addressing the breadth of evidence available. Biology is variable and scientific evidence
is continuously evolving.
(a)
723.
The IRA Team’s analysis of the probability of entry is objective and credible
New Zealand challenges the IRA Team’s assessment of the likelihood of entry of ALCM,
as follows:
[T]here is frequently no objective and rational relationship between the
scientific evidence that is cited for a step [in the Final IRA Report] and the
probability value that is chosen. Indeed, frequently a value is chosen in the
absence of sufficient scientific support. As a result, the IRA’s analysis [of
ALCM] is not an analysis of likelihood at all, it is speculation, and does not
conform to the obligation under Article 5.1.908
724.
Australia will show below that the IRA Team properly assessed the probability of entry
of ALCM by first estimating the probability that ALCM would be imported with New Zealand
New Zealand’s first written submission, para. 4.378.
New Zealand’s first written submission, para. 4.106.
907
See: Panel Report, Australia – Salmon (Article 21.5 – Canada), para. 7.57.
908
New Zealand’s first written submission, para. 4.335.
905
906
226
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
apples, and then evaluating the potential distribution of apples infested with ALCM to various
utility points within Australia. In Australia’s view, New Zealand has failed to substantiate its
allegations that the IRA Team failed to take into account certain evidence or that it drew
inappropriate conclusions from the evidence available. A number of New Zealand’s claims arise
because of its failure to understand either the relevant evidence or the methodology applied by
the IRA Team to its risk assessment of ALCM.
725.
In respect of the eight importation steps for ALCM examined by the IRA Team, Australia
notes that New Zealand has limited its challenge to Importation steps 2, 3 and 8. Australia
submits that New Zealand should not be permitted to expand its claims beyond these issues at a
later stage in these proceedings.909
i.
726.
Importation step 2
The IRA Team evaluated the likelihood that apple fruit picked from relevant New
Zealand orchards would be infested with ALCM under Importation step 2.910 As they exit their
leafrolls to fall to the ground to pupate, a small proportion of ALCM larvae can fall onto fruit
and then spin their cocoon in the stem or calyx region of the apple. It is likely that cocoons
containing viable ALCM will remain with some apples when picked and exported.
727.
New Zealand claims that the IRA Team did not conduct a proper assessment of
Importation step 2.911 In support of its claim, New Zealand argues that: the IRA Team focussed
only on the presence of ALCM cocoons on apples, regardless of whether they contained live
insects; that the level of infestation of New Zealand apples is not biologically significant; and
that the IRA Team’s conclusions are based on data from two minor apple producing regions in
New Zealand. Australia will demonstrate below that New Zealand’s assertions are without basis.
Although New Zealand asserts that the probability value assigned to this step by the IRA Team
is “not supported by scientific evidence”912, New Zealand does not show how any alleged flaws
would have led to a different outcome.
909
New Zealand is equally silent in respect of the IRA Team’s assessment of the pest, garden featherfoot,
that relies upon the same modelling methodology as that for ALCM. See: Final IRA Report, Part B, pp. 193-211
910
Final IRA Report, Part B, pp. 159-160.
911
See: New Zealand’s first written submission, paras. 4.336-4.338; also, paras. 4.107-4.111 (Article 2.2).
912
New Zealand’s first written submission, para. 4.337.
227
Australia – Apples (DS367)
a.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team took into account all the evidence referred to by
New Zealand in respect of the viability of ALCM in cocoons
728.
New Zealand alleges that the IRA Team “ignored the scientific evidence available on the
viability of cocoons found on New Zealand apples and focussed only on presence of cocoons,
regardless of whether they contain live ALCM.”913
However, New Zealand has not
demonstrated how any evidence was allegedly ignored or demonstrated any flaws with the IRA
Team’s analysis.
729.
Australia agrees with New Zealand914 that ALCM cocoons themselves are not an issue;
according to the Final IRA Report, the concern is “mature larvae and pupae on apple fruit”. 915 It
is clear from the Final IRA Report that the IRA Team did not consider cocoons themselves to be
a risk factor, based on an evaluation of the evidence916 on viability of ALCM cocoons in
Tomkins et al. (1994)917, Rogers et al. (2006)918, Lowe (1993)919 and HortResearch (MAFNZ,
2005).920 On the basis of that evidence, the IRA Team decided to use a triangular distribution for
Importation step 2, which factored in the relatively low viability rate of cocoons by skewing the
distribution towards the lower likelihood end and thereby giving less weight to the maximum
value.921
New Zealand’s first written submission, para. 4.111 (Article 2.2). Also: para. 4.337.
See: New Zealand’s first written submission, paras. 4.111 & 4.337.
915
Final IRA Report, Part B, p. 158.
916
See: Final IRA Report, Part B, pp. 159-160.
917
Exhibit NZ-43: Tomkins AR, Wilson DJ, Hutchings SO & June S (1994) “A survey of apple
leafcurling midge (Dasyneura mali) management in Waikato orchards”, Proceedings of the 47th New Zealand Plant
Protection Conference.
918
Exhibit NZ-17: Rogers DJ, Walker JTS & Cole LM (2006), “Apple leafcurling midge cocoons on
apple: pupal occupancy and mortality”.
919
Lowe, S (1993) “Apple leafcurling midge”, New Zealand Apple and Pear Marketing Board: Pipmark
Technical Bulletin. Australia is not in a position to provide this document to the Panel as an exhibit. Australia notes
that this paper was produced by the New Zealand industry (Pipfruit NZ) on the ALCM infestation of New Zealand
apples to Japan. Australia understands that the Pipmark bulletins are not in the public domain, being available to
New Zealand apple growers only (see: Exhibit AUS-88: Stewart TM & Mumford J (1995), “Pest and disease
management in Hawke’s Bay, New Zealand apple orchards: results of an ‘advice-givers’ survey”, New Zealand
Journal of Crop and Horticultural Science 23: 257-265, p. 264). However, Australia expects that New Zealand
should be able to obtain and provide a copy of the paper to the Panel and to Australia.
920
Exhibit AUS-51: MAFNZ (2005).
921
Final IRA Report, Part B, p. 160.
913
914
228
Australia – Apples (DS367)
b.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand has misinterpreted the findings of Rogers et al.
(2006)
730.
New Zealand relies on a study by Rogers et al. (2006) to claim that “only approximately
15% of cocoons on New Zealand apples contain viable pupae.”922 New Zealand asserts that:
Another more recent study found that 37-42% (giving a mean of
approximately 40%) of cocoons found on apples were empty (Rogers et al.
2006: 3). The same study found that only 25% of occupied cocoons contained
live pupae. The authors of that study stated that these figures were
“representative of viability or otherwise of cocoons found on unwashed New
Zealand apples” (Rogers et al. 2006: 3). Those figures indicate that only
approximately 15% of cocoons on New Zealand apples contain viable
pupae.923
731.
Examination of the study shows that New Zealand has misinterpreted the results as to the
proportion of cocoons on New Zealand apples containing viable ALCM. Australia agrees that
the study claims to have found that around 40% of cocoons attached to apples were unoccupied,
however Australia challenges New Zealand’s claim that “approximately 15% of cocoons on New
Zealand apples contain viable pupae.”924
The study “sought to quantify the proportion of
unoccupied ALCM cocoons and the mortality status of pre-pupal ALCM in remaining cocoons
… Of those cocoons that were occupied pre-pupae were recorded as live or dead”.925 The
assessment of the mortality rate of cocoons that was conducted by the authors was limited to
those cocoons that were occupied. Sixty percent of the total cocoons were occupied. Of these, a
mean of 59% contained immobile pupae926, so that around 25% of the total number of cocoons
found in the sample of apples contained viable ALCM – not 15% as New Zealand claims.927
732.
It is notable that Rogers et al. (2006) expressed the view that their results are
“representative of viability or otherwise of cocoons found on unwashed New Zealand apples.”928
New Zealand’s first written submission, para. 4.107 (Article 2.2); also, see: para. 4.337.
New Zealand’s first written submission, paras. 4.107 (Article 2.2), 4.337.
924
New Zealand’s first written submission, paras. 4.107 (Article 2.2), 4.337.
925
Exhibit NZ-17: Rogers DJ, Walker JTS & Cole LM (2006), “Apple leafcurling midge cocoons on
apple: pupal occupancy and mortality”, p. 1.
926
The IRA Team took into account the Rogers et al. (2006) findings that 36.5-42.2% of ALCM cocoons
were unoccupied and 34.1%-87.1% of cocoons that contained dead midge pupae: Final IRA Report, Part B, p. 160.
927
59% (dead pupae) x 60% (occupied cocoons) = 35% (proportion of total cocoons containing dead
pupae). 100 – 40 – 35 = 25% (cocoons containing viable ALCM).
928
Exhibit NZ-17: Rogers et al. (2006), p. 2.
922
923
229
Australia – Apples (DS367)
733.
Australia’s First Written Submission of Australia
18 July 2008
Furthermore, the IRA Team considered that the Rogers et al. (2006) study may have
underestimated the number of viable cocoons in the sample tested. According to the authors of
the study, “[o]f those cocoons that were occupied pre-pupae were recorded as live or dead, with
death characterised as failure to move when prodded.”929 As the insect goes through three life
stages within a cocoon (larvae, pre-pupae and pupae930), it is unclear why the authors assumed
that all the occupants of the cocoons tested were pre-pupae. If the insect inside a cocoon tested
was in the pupal stage, prodding the occupant with a needle would not necessarily result in any
movement. Therefore, the findings by Rogers et al. (2006) that 25% of cocoons contained viable
ALCM was probably an underestimation. The most reliable method would have been to observe
the proportion of occupants that emerged as adults.
734.
It is clear that New Zealand relied heavily on its faulty interpretation of the findings in
Rogers et al. (2006) throughout its calculation of probability of entry, establishment and spread
for ALCM. New Zealand relies upon Rogers et al. (2006) for a viable infestation rate of 15% to
assert that “in order to have three live ALCM, 20 apples with cocoons would have to be
discarded close together”,931 which it then uses to justify its claim that:
The standard AQIS fruit inspection regime involving a 600 fruit sample
inspection would provide 95% confidence that no more than 0.5% (1 in 200)
fruit have cocoons. On this assumption, at least 4,000 fruit would need to be
deposited in one place at the same time to obtain three apples with three live
ALCM.932
735.
If New Zealand’s example is adjusted to reflect the correct Rogers et al. (2006)
infestation rate of 25%, then only 2,400 fruit (not 4,000) would be needed to obtain three apples
with three live ALCM together,933 but possibly even less than this taking into account the
probable underestimation of the viable infestation rate. Furthermore, New Zealand’s example
factors in the possibility of a 600-unit inspection measure by AQIS, and therefore it does not
reflect the unrestricted risk assessed by the IRA Team.
929
Exhibit NZ-17: Rogers et al. (2006), p. 1. (emphasis added)
Exhibit AUS-89: Tomkins AR (1998), “Apple leaf-curling midge life cycle”, HortFACT, (Horticulture
and Food Research Institute of New Zealand Ltd).
931
New Zealand’s first written submission, para. 4.126.
932
New Zealand’s first written submission, para. 4.127 (footnote omitted) (Article 2.2). New Zealand also
relies on its flawed calculations to support its claims under other provisions of the SPS Agreement: see: New
Zealand’s first written submission, paras. 4.360, 4.362 & 4.517.
933
If the infestation rate is only 0.13%, as suggested by New Zealand (New Zealand’s first written
submission, para. 4.128 (Article 2.2)), then 9,231 apples would be needed together to obtain three apples with three
live ALCM (not 15,000 fruit, as claimed by New Zealand).
930
230
Australia – Apples (DS367)
736.
Australia’s First Written Submission of Australia
18 July 2008
Australia considers that New Zealand’s faulty estimations of the level of viable ALCM
infestation of New Zealand apples has irredeemably tainted its estimations of likelihood of entry,
establishment and spread, and consequently its assertion as to the level of risk and the efficacy of
particular measures to reduce the risk to achieve Australia’s ALOP.
c.
The IRA Team took into account the relevant data available for
different areas of New Zealand
737.
New Zealand erroneously claims that the IRA Team’s conclusion on Importation step 2
in the Final IRA Report “is based [only] on historical data from two minor apple producing
regions, Waikato and Bay of Plenty, both of which have warm wet climates more conducive to
ALCM than the major apple export production area in New Zealand (Hawke’s Bay), and which
have very little role in growing apples for export.”934 It is clear from the Final IRA Report that
the information from the Waikato region and the Bay of Plenty referred to by New Zealand
(from Tomkins et al. 1994), together with available data from Nelson and Hawke’s Bay orchards
was taken into account (Rogers et al. 2006, HortResearch (MAFNZ 2005b)).935 New Zealand
has not identified any alternative source of reliable data which the IRA Team did not take into
account. Furthermore, New Zealand as a whole was the pest risk area under examination (rather
than any specific region); as there are no controls on the movement of apples around New
Zealand, data collected even from a minor apple producing region is valid.
d.
738.
Summary
Australia submits that it is clear that the IRA Team took into account all the evidence
identified by New Zealand in its consideration of Importation step 2 and that New Zealand has
failed to demonstrate any flaws in its assessment.
ii.
739.
Importation step 3
The IRA Team considered that infested leaves and trash may sometimes collect in the
picking bags or ground bins at Importation step 3.936 Apples are picked by hand into picking
934
New Zealand’s first written submission, para. 4.336 (footnote omitted); also, see: para. 4.107 (Article
935
Final IRA Report, Part B, pp. 159-160.
Final IRA Report, Part B, p. 161.
2.2).
936
231
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
bags, and then typically transferred into bins kept on the ground in the orchard before
transportation to the packing house.
740.
New Zealand erroneously claims that the IRA Team overestimated the likelihood that
clean fruit may be contaminated during picking and transport to the packing house 937, on the
basis that: leaves prone to ALCM infestation would not be harvested with fruit; and that any
leaves mistakenly harvested with fruit would not likely be infested with ALCM during the
harvest period. The IRA Team considered that the potential for viable ALCM larvae or pupae to
be associated with trash after harvesting and transport would be small but not zero (and
represented the likelihood as a uniform distribution between 0.1% and 5%).938 The IRA Team
took into account the likelihood that most of this trash and contamination would be removed in
routine packing house procedures under Importation step 4,939 which is not acknowledged by
New Zealand.
a.
Leaves accidentally harvested would not necessarily be those
directly adjacent to apples picked
741.
New Zealand argues that “the young soft leaves on which ALCM lay their eggs are
spatially separate from the parts of the trees where fruit development occurs (the previous year’s
wood). That such leaves would be harvested with fruit is highly improbable.”940
742.
However, the main area of concern for the IRA Team was not the chance of
contamination by ALCM cocoons and leaves directly adjacent to the fruit harvested. New
Zealand has not reflected the practical reality that fruit-picking requires pickers to reach in and
around trees and branches to pick individual pieces of fruit without bruising them. It is quite
probable that pickers will brush against leaves or branches of other parts of trees which may
sometimes harbour ALCM leaf rolls, occasionally causing ALCM larvae to fall from elsewhere
on the tree into a picking bag or bins on the ground.
New Zealand’s first written submission, paras. 4.339 & 4.115 (Article 2.2).
Final IRA Report, Part B, p. 161.
939
Final IRA Report, Part B, pp. 162-163.
940
New Zealand’s first written submission, para. 4.340; also, see: paras. 4.112-4.113 (Article 2.2).
937
938
232
Australia – Apples (DS367)
b.
Australia’s First Written Submission of Australia
18 July 2008
A certain level of ALCM infestation of apple trees continues
through harvest time
743.
New Zealand also argues that, “even if young branch shoot leaves could somehow
mistakenly be harvested with apple fruit, they would be very unlikely to be infested as, by
harvest, ALCM infestation levels are low due to the declining availability of new shoot
growth”.941
744.
The IRA Team considered that there would be sufficient flushes of leaf growth at harvest
suitable for ALCM infestation.942 Flushes of leaf growth occur in association with branch and
twig growth, and water shoots may be stimulated by earlier pruning. These later growth flushes
may be stimulated by irrigation or wet seasonal conditions. Todd (1959)943 observed that rainfall
appears to have a definite effect on the degree of infestation by influencing the amount of new
growth. The greatest degree of infestation of particular leaves occurs when there has been strong
competition for appropriate sites to lay eggs by female ALCM, resulting in a concentration of
eggs on the available leaves944 – such as late in the season when harvest occurs.
745.
Throughout the season, there is likely to be a ready supply of uncurled or partially
uncurled leaves suitable for ALCM (Barnes, 1948945), which accounts for the ability of the insect
to go through seven generations in wet seasons and to have mature larvae that can infest the fruit
during harvest (Tomkins, 1998946).
c.
746.
Summary
New Zealand has failed to establish any flaw with the probability range as judged by the
IRA Team for Importation step 3.
New Zealand’s first written submission, paras. 4.342; also: para. 4.114 (Article 2.2).
See: Final IRA Report, Part B, p. 161.
943
Exhibit NZ-44: Todd DH (1959).
944
Exhibit NZ-44: Todd DH (1959), p. 868.
945
Exhibit NZ-18: Barnes HF (1948), p. 36.
946
Exhibit AUS-89: Tomkins AR (1998), “Apple leaf-curling midge life cycle”, HortFACT, (Horticulture
and Food Research Institute of New Zealand Ltd).
941
942
233
Australia – Apples (DS367)
iii.
747.
Australia’s First Written Submission of Australia
18 July 2008
Importation step 8
The IRA Team evaluated the likelihood that ALCM would survive and remain with the
apple fruit after on-arrival minimum border procedures under Importation step 8.947
748.
New Zealand makes no claims in respect of Importation step 8 under Article 2.2. In
relation to its claims under Article 5.1, New Zealand makes two allegations in respect of
Importation step 8. First, that “the IRA failed to take into account the 2001-2004 data provided
by New Zealand to Australia which provide a real world data-based value for the infestation
level in a consignment prior to presentation to AQIS for inspection.”948 Secondly, that the “IRA
also disregarded … the effect of AQIS inspection procedures at the border … [such as] the
traditional sample size inspected by AQIS at the border, a 600-unit inspection”.949 Both claims
exhibit New Zealand’s failure to understand the nature of the evaluation undertaken at
Importation step 8 when evaluating unrestricted risk.
a.
749.
The potential infestation rate is irrelevant at Importation step 8
It is not relevant to take into account potential infestation rates at Importation step 8,
because this step involves the likelihood that ALCM survives and remains with the fruit after onarrival minimum border procedures, rather than the proportion of apples infested with cocoons or
viable ALCM upon arrival. The relatively high likelihood value given to this step by the IRA
Team merely emphasises that minimum on-arrival border procedures would not be effective in
detecting or destroying any viable ALCM. However, the 2001-2004 data950 (referred to by New
Zealand) confirms that a certain level of viable ALCM could survive packing house, quality
inspection and export processes, and could arrive in Australia even if measures for fruit
inspection are applied.
947
See: Final IRA Report, Part B, p. 165.
New Zealand’s first written submission, para. 4.345.
949
New Zealand’s first written submission, para. 4.346.
950
Exhibit AUS-90: Pipfruit NZ (2005), Correspondence sent from Pipfruit NZ to Biosecurity Australia, 3
August 2005.
948
234
Australia – Apples (DS367)
b.
Australia’s First Written Submission of Australia
18 July 2008
It is inappropriate to factor in an inspection when assessing the
unrestricted risk of importation
750.
At Importation step 8, the IRA Team assessed only the unrestricted risk of ALCM
associated with New Zealand apples. The Final IRA Report clearly explained the underlying
assumptions, as follows:
The factors considered here relate only to the minimum border procedures
used by relevant government agencies. There is some AQIS inspection, such
as verification of the commodity as described in the shipping documents,
verifying external and internal contamination of containers and their
packaging.
Possible AQIS on-arrival inspection for quarantine pests
associated with apples is not considered in the assessment of unrestricted
risk.951
751.
Accordingly, it would have been inappropriate for the IRA Team to factor in a potential
600-unit AQIS inspection at this step of the analysis, as submitted by New Zealand, because that
inspection would constitute a measure and the risk assessed would no longer be the
“unrestricted” risk. The efficacy of a 600-unit inspection was properly assessed in the risk
management stage of the ALCM analysis in the Final IRA Report.952
c.
752.
Summary
New Zealand has failed to demonstrate any flaws with the IRA Team’s assessment of
Importation step 8.
iv.
753.
The IRA Team’s conclusions on importation
On the basis of its analysis of the eight importation steps and the use of the risk
simulation model to combine the various likelihoods, the IRA Team concluded that around 4.1%
(mean) of apples imported from New Zealand annually would be infested with viable ALCM.953
754.
In August 2005, New Zealand provided some data to the IRA Team generated from end-
point inspections of New Zealand apples exported to the United States in the period 2001-2004
951
Final IRA Report, Part B, p. 23.
See: Final IRA Report, Part B, pp. 188-192.
953
Final IRA Report, Part B, p. 165.
952
235
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
(August 2005 data).954 This data is set out in Table 40 of the Final IRA Report.955 The data was
received only after many earlier requests for such information by the IRA Team. 956
755.
The IRA Team recognised that the August 2005 data indicated the level of ALCM
infestation of export quality New Zealand apples destined for the United States (which gave a
range of 0.1%-0.38%).
However, as that data reflected a level of importation where risk
mitigation measures were already applied, and therefore not unrestricted risk, the IRA Team
chose to use both its original figures (mean of 4.1%) as well as the August 2005 data to continue
its analysis of the probability of entry, establishment and spread and potential risk
management.957
v.
756.
Distribution
Having evaluated the likelihood that ALCM could be imported with New Zealand apple
fruit, the IRA Team then considered the issue of distribution. Probability of entry, establishment
or spread of the pest in Australia relies on the probability that ALCM would be distributed in a
viable state to an endangered area in Australia, transferred to a suitable host, where it could
propagate on or in that host and disperse from there to other populations of susceptible hosts.
These assessments are based primarily on biological considerations, and involve a complex set
of interacting factors.
757.
The IRA Team considered the proportion of utility points958 near susceptible hosts959,
estimations of the number of infested fruit that could arrive at each utility point, and how the
insects could be transferred to susceptible hosts. Apple (all varieties) is the only susceptible host
to ALCM (Todd, 1959; Tomkins, 1998).960
954
Exhibit AUS-90: Pipfruit NZ (2005), Correspondence sent from Pipfruit NZ to Biosecurity Australia, 3
August 2005.
955
Final IRA Report, Part B, p. 166.
956
Exhibit AUS-90: Pipfruit NZ (2005), Correspondence sent from Pipfruit NZ to Biosecurity Australia, 3
August 2005.
957
See: Final IRA Report, pp. 166, 172-174, 178-183, 190-192.
958
The “utility points” considered by the IRA Team were divided into five categories: orchard wholesalers,
urban wholesalers, retailers, food services, and consumers.
959
Susceptible host plants were divided into four “exposure groups”: commercial fruit crops, nursery
plants, household and garden plants, wild and amenity plants.
960
Exhibit NZ-44: Todd DH (1959); Exhibit AUS-89: Tomkins AR (1998), “Apple leaf-curling midge
life cycle”, HortFACT, (Horticulture and Food Research Institute of New Zealand Ltd).
236
Australia – Apples (DS367)
758.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team adapted its methodology for ALCM because the likelihood of ALCM
entry, establishment and spread would depend on the number of viable ALCM that might reach a
particular location at around the same time, to enable a mating pair to establish a population.961
759.
Also, unlike the model used for fire blight and European canker where the main focus
was fruit discarded as waste, the model used by the IRA Team for ALCM factored in the
potential for the pest to escape from utility points (because it is mobile). 962 New Zealand is
fixated on waste963 and fails to appreciate the significance of ALCM’s biological difference from
E. amylovora and N. galligena because it does not acknowledge the potential for adult ALCM to
escape from imported New Zealand apples from any point in Australia to which they are
distributed, and not only from apples that are dumped as waste.
760.
The Final IRA Report states:
If mature larvae or pupae survive cold storage or controlled atmosphere
storage, adults could emerge from the pupal stage after the apples have been
taken out of storage, or wherever the cold chain is broken such as at unpacking
and repacking facilities or retailers and during the transportation of purchased
apples from retailers to households or with fruit that is dumped.964
Therefore, adult ALCM may emerge at any point from when the “cold chain is broken”,
assuming they have survived storage.
761.
ALCM typically diapause (a form of hibernation) in cocoons over winter and emerge in
the spring, meaning that they may survive the cold conditions of transportation and storage. The
IRA Team reasoned that, “adults could emerge from the pupal stage after the apples have been
taken out of storage, or wherever the cold chain is broken such as at unpacking and repacking
facilities and during the transportation of purchased apples from retailers to households or with
fruit that is dumped.”965
762.
New Zealand claims that the IRA Team’s evaluation was flawed because:
961
This differs from fire blight and European canker where the likelihoods can be assessed on an individual
apple basis. Final IRA Report, Part B, pp. 33, 166-167.
962
See: Final IRA Report, Part B, p. 33.
963
See: New Zealand’s first written submission, paras. 4.119, 4.126, 4.129-4.132 (Article 2.2), 4.3524.353, 4.361.
964
Final IRA Report, Part B, p. 171.
965
Final IRA Report, Part B, p. 171.
237
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
[It] is based on incorrect assumptions, including about the likelihood of apples
being discarded in close proximity to susceptible host apple trees, the
circumstances under which live pupae will emerge from cocoons, the flight
range of ALCM, and the likelihood that mating can successfully occur.966
763.
In relation to these claims, Australia will show below that New Zealand has failed to
establish any flaws with the IRA Team’s reasoning and use of the available evidence.
a.
764.
Conditions could favour ALCM emergence in Australia
New Zealand claims that most New Zealand apples will be consumed or decay before
ALCM emergence can take place, on the basis that:
New Zealand fruit would arrive in the Australian market in autumn and winter.
By spring, most of this fruit will have been sold and consumed, or … disposed
of. And, even if ALCM emerged in this period, there would be no young,
actively growing apple leaves available on which to lay eggs.967
765.
New Zealand argues that “[a]dult emergence from diapause is synchronised to occur in
spring when environmental conditions change”968, and therefore that “only viable pupae on New
Zealand apples removed from temperature controls in spring would be able to emerge from
diapause.”969
766.
New Zealand recognises that “[a]dult emergence from diapause is synchronised to occur
… when environmental conditions change”.970 Therefore, if the cool chain is broken and day
length and temperature replicate spring (for example, in a controlled environment such as a
supermarket or packing house, or in some more northern areas of Australia), then adult
emergence from diapause may take place in seasons other than spring.
767.
New Zealand claims:
[A]ny ALCM emerging during the likely period of import – that is, autumn
and winter (March to September) – could not go on to infest new hosts even if
a male and female did emerge close enough to find each other and successfully
mate, because there are no new leaf shoots in autumn and winter. Only a small
New Zealand’s first written submission, para. 4.352; also, see: para. 4.116 (Article 2.2).
New Zealand’s first written submission, para. 4.119 (Article 2.2); also, see: paras. 4.358-4.359.
968
New Zealand’s first written submission, para. 4.118.
969
New Zealand’s first written submission, para. 4.358.
970
New Zealand’s first written submission, para. 4.118.
966
967
238
Australia – Apples (DS367)
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18 July 2008
proportion of New Zealand apples would remain in cold storage unsold until
spring.971
768.
Australia notes that New Zealand offers no evidence in support of its biological
assertions, nor for its assertion that there would be only a “small proportion” of New Zealand
apples remaining in Australia in the spring. New Zealand is also silent on the fate of viable
pupae that remain on waste such as culled fruit and apple cores that are discarded on the ground
prior to spring at orchard wholesalers and retailers. This incorrectly implies that this infested
fruit is no longer a concern.
769.
Given the Australian apple harvest takes place around the same time as New Zealand’s,
Australian apples would also supply the domestic market over at least autumn and winter.
Accordingly, the IRA Team judged it unlikely that all of the imported New Zealand apples
would be consumed as soon as they were imported. There is considerable capacity for apples to
be kept in storage in Australia for sale over time.972
770.
Furthermore, imports of New Zealand apples may continue into September in any
year973, as acknowledged by New Zealand974, coinciding with the beginning of spring in
Australia and the appropriate environmental conditions for both the emergence of adult ALCM
and new tree growth. In fact, apples from New Zealand may be imported even later than
September. Cold stored and controlled atmosphere stored apples are released for retail sale in
Australia up to the time or beyond the next harvest of each variety.
New Zealand itself
acknowledges that “one sixth of the amount imported” would still be in Australia during
spring975, which Australia considers would be more than sufficient given the estimate volume of
annual trade. The IRA Team relied upon the report by Tomkins et al. (2006)976 that emergence
in New Zealand of overwintered adult ALCM occurred from mid-September to midNovember.977
New Zealand’s first written submission, para. 4.359. Also, see: paras. 4.119-4.120 (Article 2.2).
Exhibit AUS-91: Australian Bureau of Statistics, “Agricultural Survey: Apples and Pears Australia
2006-07”, 7121.0.55.002, 18 December 2007, p. 6.
973
Exhibit AUS-63: United States Department of Agriculture Foreign Agricultural Service, “New Zealand
Fresh Deciduous Fruit Report 2007”, GAIN Report Number: NZ7033, 18 December 2007, p. 7.
974
New Zealand’s first written submission, para. 4.359. Also, see: paras. 4.119-4.120 (Article 2.2).
975
New Zealand’s first written submission, para. 4.120 (Article 2.2).
976
Exhibit AUS-92: Tomkins AR, Bradley SJ, Walker JTS, Gibbs AR, Marsha1l R, Shaw PW, Thomson
C, Burnip G, Wearing CH & Wilson DJ (2006), “Spring emergence of apple leafcurling midge in New Zealand”.
977
Final IRA Report, Part B, p. 171.
971
972
239
Australia – Apples (DS367)
771.
Australia’s First Written Submission of Australia
18 July 2008
Furthermore, the IRA Team reasoned that even if apples are consumed, they are often not
completely destroyed because people do not usually eat apple cores. Apple cores, potentially
infested with ALCM at stem end or calyx, could be thrown into a garden or an orchard near a
potential host. Pupation typically takes place inside cocoons beneath the surface of the ground
(Tomkins, 1998)978, where the insects can wait until favourable environmental conditions occur
for their emergence.
b.
More than enough infested apples may arrive at orchard packing
houses to permit sufficient numbers of adult ALCM to emerge and
reproduce
772.
New Zealand claims that:
The only place where significant numbers of apple fruit could be removed
simultaneously from cold storage, in close proximity to apple trees, is if the
fruit were sent to an orchard wholesaler.979
773.
New Zealand argues that the IRA Team overestimated the quantities of apples that will
be sent to orchard wholesalers,980 on the basis that most of its product will be imported “retail
ready” and that “[t]he primary market for this fruit will be in the major urban centres and for
commercial reasons the fruit would be stored nearby. The proportion requiring repackaging
would be very small and readily handled by urban facilities.”981
774.
The IRA Team considered the varying views as to how apples might be distributed
within Australia in light of whether the apples would come in as bulk produce that need to be
repacked or whether they would come in market ready boxes and sent directly to urban
wholesalers for distribution.982 Two possible scenarios were considered by the IRA Team:
One scenario was based on 0.1%-5% of imported apples being distributed to
orchard packing houses and the remainder (95%-99.9%) being distributed to
urban wholesalers [Scenario 1]. The other scenario was based on 70%-100%
of imported apples being distributed to orchard packing houses and the
remainder (0-30%) being distributed to urban wholesalers [Scenario 2].983
978
Exhibit AUS-89: Tomkins (1998).
New Zealand’s first written submission, para. 4.361; also, see: para. 4.129 (Article 2.2).
980
New Zealand’s first written submission, paras. 4.129, 4.357, 4.361.
981
New Zealand’s first written submission, para. 4.357.
982
Final IRA Report, Part B, pp. 171-172.
983
Final IRA Report, Part B, p. 172.
979
240
Australia – Apples (DS367)
775.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team considered the distribution to orchard-based facilities, as follows:
The number of orchard based facilities is particularly important for pests such
as insects where clustering may be significant. For example, risks may be
greater where large volumes of apples are present in one facility at one time
and therefore there is a greater chance of a mating pair. This would be
dependent on the number of orchard based facilities.984
776.
The IRA Team assumed that there would be seven orchard wholesalers and six urban
wholesalers within Australia that might repack imported fruit. Applying the two scenarios in
relation to apple distribution referred to above (referred to as Scenario 1 and Scenario 2 in the
table below), and the two potential rates of infestation of New Zealand apples, the IRA Team
calculated the estimated number of infested fruit distributed to individual utility points on the
basis that fruit would be imported over a 26-week period.985 Tables 42 and 43 in the Final IRA
Report set out the weekly estimates.986
777.
In respect of orchard wholesalers, the results set out in the Final IRA Report987 can be
summarised as follows:
Table 6: Numbers of infested apples predicted to arrive at orchard wholesalers
Level of infestation
Split between orchard
Predicted weekly number of infested fruit to each
wholesalers & urban
individual orchard wholesaler (mean)
packinghouses
Scenario 1
995
Scenario 2
33204
August 2005 data
Scenario 1
50
(min 0.1%, most likely
Scenario 2
1661
4.2% (mean)
0.13%, max 0.38%)
778.
Therefore, even assuming the lower infestation rate as suggested by the August 2005 data
provided by New Zealand, and assuming that only 0.1%-5% of imported apples are distributed to
orchard packing houses (Scenario 1), the IRA Team calculated that around 50 apples infested
984
Final IRA Report, Part B, p. 34. (emphasis added)
Final IRA Report, Part B, pp. 33-34, 171-174.
986
Final IRA Report, Part B, pp. 173-174.
987
See: Final IRA Report, Part B, pp. 173-174.
985
241
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
with viable ALCM would arrive at an individual orchard packing house each week (on average
across a 26 week period). If the majority of New Zealand apples are sent to orchard packing
houses (Scenario 2) – which Australia considers most probable – then at least 1661 infested
apples may arrive at each orchard packing house each week. On the basis of New Zealand’s
argument that at least three adult ALCM insects would be required to mate and start a
population988, it is clear this quantity of infested apples would be sufficient.
779.
New Zealand also disputes the proximity values used in the Final IRA Report in respect
to the proportion of retailers and the Australian population that live near commercial fruit
crops989, and also in respect to nursery plants which may be near utility points.990 New Zealand
has not provided any evidence in support of its assertions, nor does it explain what impact its
assertion would have had on the conclusions of the Final IRA Report if correct. In any event, it
is clear from the Final IRA Report that the likelihood values assigned to these aspects of the
assessment were very small and would have had minimal impact on the outcome.991
c.
New Zealand’s claim that its apple exports will arrive “retail
ready” and therefore require little repacking in Australia is
unsubstantiated
780.
New Zealand claims that, “New Zealand fruit is very unlikely to be sent to an orchard
wholesaler for re-packing given the “retail ready” and “just in time” nature of New Zealand’s
apple exports.”992 However, there were good reasons for the IRA Team to doubt New Zealand’s
claim that the majority of its fruit would be “retail ready” and require little repacking in
Australia. New Zealand has failed to support its assertion in respect of the Australian market
with any data or other evidence. New Zealand also ignores its previous refusal to rule out modes
of trade other than “retail ready” or “just in time” during the IRA process.993 It was appropriate
for the IRA Team to take into account the other potential modes of trade by which New Zealand
apples may arrive in Australia.
New Zealand’s first written submission, para. 4.126.
New Zealand’s first written submission, para. 4.354.
990
New Zealand’s first written submission, para. 4.355.
991
Final IRA Report, Part B, p. 179.
992
New Zealand’s first written submission, para. 4.361; also, see: para. 4.129 (Article 2.2).
993
See: Final IRA Report, Part B, pp. 9-10.
988
989
242
Australia – Apples (DS367)
781.
Australia’s First Written Submission of Australia
18 July 2008
Furthermore, Australia submits that the requirements and demands of Australian
importers and buyers will ultimately influence the type of product exported from New Zealand.
In Australian retail outlets, large quantities of apples are often displayed on tables or sold from
crates, rather than being displayed in smaller “retail ready” boxes.
782.
For example, one of the largest retailers of fresh fruit in Australia is the supermarket
chain Coles. In 2005, Coles introduced a system of returnable plastic crates, whereby the crates
are sent to Coles’ suppliers who then pack the fruit straight into them. The crates are used to
display the fruit in the stores, and then returned to the suppliers for re-use.994 Australia considers
it highly unlikely that empty crates would be sent from Australia to New Zealand on a regular
basis in order for New Zealand exporters to pack their apples for Australia in the required form
for Coles. Therefore, it seems infeasible for New Zealand exporters to provide fruit in the “retail
ready” form required by one of Australia’s largest retailers. The IRA Team considered that New
Zealand exporters would opt for the best commercial option available, and, as Australia imposes
no requirement as to the particular mode of trade, New Zealand exporters could ship fruit in bulk
bins that could be repacked and distributed in Australia for specific markets.
783.
New Zealand’s claim that the majority of its apple exports to Australia will be in the
“retail ready” form required by Australian retailers is unsubstantiated. In any event, it is clear
from the IRA Team’s analysis that even if only 0.1%-5% of imported apples were distributed to
orchard packing houses, around 50 apples infested with ALCM would arrive at seven individual
orchard packing houses each week.995
d.
New Zealand makes flawed assumptions about fruit fly
management in Australia
784.
New Zealand claims that “large quantities of apples would not be discarded uncovered
near apple trees at an orchard wholesaler”, because “in a country such as Australia, where
removal of discarded fruit from orchards is essential for good fruit fly management, it would be
994
Exhibit AUS-62: Coles Myer’s returnable plastic crate initiative: Coles Group, National Packaging
Covenant
Annual
Report
2006/7,
p.
27
(website
http://www.packagingcovenant.org.au/documents/File/Coles_Group_AR_06_07_Public.pdf, accessed 9 July 2008);
Coles
Myer
Ltd,
Corporate
Social
Responsibility
Report
2005,
p.
16
(website
http://www.colesgroup.com.au/library/newsmedia/20051019_corporate_social_responsibility_report.pdf, accessed 9
July 2008); Exhibit AUS-63: United States Department of Agriculture Foreign Agricultural Service, “New Zealand
Fresh Deciduous Fruit Report 2007”, GAIN Report Number: NZ7033, 18 December 2007, p. 8.
995
Final IRA Report, Part B, pp. 173-174.
243
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
contrary to good operational practice for commercial packing house operators, or even nearby
orchardists, to leave any discarded fruit uncovered and exposed to pests.”996
785.
However, New Zealand fails to acknowledge that practices to manage fruit fly are only
mandated in fruit fly free areas and are not implemented unless there is actually an outbreak of
fruit fly in a particular area.997 If there is no fruit fly outbreak in the fruit fly free areas, then
there is no need to take steps to manage this issue. When there is an outbreak, fruit fly
management is targeted at the production aspect and at uncovered fruit and waste in specified
proximity zones to the outbreak through the use of fruit fly specific sprays.998 In any event, the
bulk of relevant apple handling facilities in Australia occur in apple production regions that are
not those specifically intended as fruit fly free areas, or are areas where fruit flies are not
historically an issue for apple production. New Zealand has failed to provide any evidence to
suggest otherwise.
e.
The scenario of 4000 apples being left uncovered together
somewhere is not improbable
786.
New Zealand claims:
[T]he likelihood of an Australian buyer of New Zealand apples disposing of at
least 4,000 of those apples uncovered, at a single site within 30m of apple trees
with new shoots is negligible.999
787.
Australia has already explained why New Zealand’s assumptions as to waste being the
only scenario worth considering and the management of apple waste in Australia are without
basis.
788.
In coming to a figure of 4000 apples, New Zealand has relied on the infestation level that
would result from apples passing an AQIS inspection of 600 units per lot.1000 As previously
explained, it is not appropriate to factor in such a potential inspection when assessing the
unrestricted risk. Furthermore, New Zealand’s figure of 4000 apples is derived from its flawed
New Zealand’s first written submission, para. 4.130 (Article 2.2). Also, see: paras. 4.361, 4.362.
See: Exhibit AUS-93: Extract from AQIS Plant Programs Section (2008), Australia – New Zealand
Bilateral Quarantine Arrangement: Systems Operation Manual 7, February 2008, pp. 26-28.
998
See, for example: Exhibit AUS-94: Standing Committee on Agriculture and Resource Management,
Code of Practice for Management of Queensland Fruit Fly, (Interstate Plant Health Working Group, Australia),
September 1996, Sections 3 & 4.
999
New Zealand’s first written submission, para. 4.362.
1000
See: New Zealand’s first written submission, paras. 4.127-4.128 (Article 2.2), 4.360.
996
997
244
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
interpretation of the findings in Rogers et al. (2006), as explained above. Based on the data from
Rogers et al. (2006), only 2,400 apples or less would be sufficient to provide three infested
apples.
789.
In any event, the figure of 4000 apples together at the same location at the same time is
small given the potential millions of New Zealand apples that may be imported to Australia. As
explained above, the IRA Team estimated that between 50 and 1661 infested apples could arrive
at an orchard packing house in any single week.1001
f.
790.
Summary
New Zealand has failed to demonstrate any flaws in the IRA Team’s estimations of the
quantities of infested apples that would be distributed to a suitable utility point located near
potential hosts, such as orchard packing houses, in suitable environmental conditions to enable
adult ALCM to emerge.
vi.
791.
Conclusion on entry
Australia submits that New Zealand has failed to establish any flaws in the IRA Team’s
assessment of entry for ALCM.
(b)
The IRA Team’s analysis of probability of establishment is objective and
credible
792.
The IRA Team judged that a population of ALCM could start in Australia from a small
group of viable eggs laid by a single female. A mated female lays several eggs on each selected
leaf, with each female laying up to 200 eggs over about three days.1002
793.
New Zealand has challenged the IRA Team’s assessment of the likelihood of a sufficient
quantity of adult ALCM emerging and mating within sufficient proximity to potential hosts.1003
As Australia will demonstrate below, New Zealand has failed to establish any flaws in the IRA
Team’s appreciation of the evidence; nor has New Zealand shown how the level of risk assessed
by the IRA Team would have been different had they agreed with New Zealand’s assessment of
1001
See: Final IRA Report, Part B, pp. 173-174.
Final IRA Report, Part B, p. 176; Exhibit AUS-89: Tomkins (1998).
1003
See: New Zealand’s first written submission, paras. 4.125, 4.131 (Article 2.2), 4.359.
1002
245
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
the evidence. New Zealand focusses on specific timeframes and distances without appreciating
the range of data available on the relevant issues.
794.
Australia notes that New Zealand fails to challenge the establishment stage for ALCM,
which relates to what happens after a sufficient number of eggs have been successfully laid,
comprising the first colonising generation.
New Zealand effectively only challenges the
probability of whether a first generation of eggs will be successfully laid in Australia.
i.
795.
Time required to break diapause
New Zealand claims:
ALCM will not emerge from fruit as soon as it is removed from cold storage.
It first has to break diapause and complete pupation, which takes 13-18 days
(Barnes 1948: 36).1004
796.
However, the IRA Team considered that not all viable ALCM infesting New Zealand
apples would need 13-18 days to emerge as adults after being removed from cold storage.
ALCM undergo complete metamorphosis from larvae (maggots) to adult (winged stage). There
is a series of active, feeding larval developmental stages which progress through a quiescent
prepupal stage before a single pupal stage, which finally moults into the adult. The onset of
pupation marks the beginning of a process that results in the destruction of larval organs and
tissues, accompanied by a rapid equivalent differentiation of adult structures. These processes
continue through the pupal stage and are often not completed until after the adult has emerged.
During diapause, these processes are suspended or progress at very reduced rates until more
favourable environmental conditions return and metamorphosis can be completed.1005
797.
New Zealand seems to assume that the insects in the cocoons on imported New Zealand
apples will all be at exactly the same stage of development; that is, the prepupal stage prior to
metamorphosis of the pupal stage. However, the IRA Team considered it more likely that at the
end of the New Zealand growing season when harvest occurs, various ALCM present in cocoons
will be at different stages of development (Tomkins, 1998).1006 It is probable that some larvae
will have progressed beyond the prepupal stage to the pupal stage and will be ready to emerge as
New Zealand’s first written submission, para. 4.131 (Article 2.2); also, see: para. 4.361.
For general information on metamorphosis, see: Richards OW, Davies RG (1994), “Structure,
Physiology and Development”, Imms’ General Textbook of Entomology, Volume 1(Chapman and Hall: London),
10th edition.
1006
Exhibit AUS-89: Tomkins (1998).
1004
1005
246
Australia – Apples (DS367)
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18 July 2008
adults as soon as the appropriate environmental triggers are encountered by the pupa, rather than
wait the 13-18 days as recorded by Barnes (1948).1007
798.
In New Zealand, the insect stays within its protective cocoon in the soil in a dormant state
(diapause) during the winter period and emerges from dormancy when the conditions are
favourable for its development. Cocoons on apples held in cold storage would be subject to the
same processes. Any insect kept in cold storage could remain within its cocoon until the
environmental conditions are favourable or its internal development has been completed. Spring
conditions can be mimicked by lighting and air-conditioning in warehouses and supermarkets.
ii.
799.
Little time is required for reproduction by ALCM
New Zealand claims that:
Even if pupae did enter Australia and successfully emerge, the short adult life
span and limited flying distances of ALCM mean that there is virtually no
chance of male and female emerging from cocoons on individual apples in
close enough proximity to find each other and successfully mate.1008
800.
Adult ALCM do not need to live for long periods in order to reproduce. According to
one source, mating behaviour of the males commences about half to one hour after their
emergence; on average, females call for males within 20 minutes of emergence, mate within 40
minutes and lay their eggs later that day (HortResearch, 19991009). Another source states that
females start calling around two hours after emergence, mate thereafter, and start to lay eggs by
the end of the day (Suckling et al. 20071010). Virgin females produce a sex pheromone that
attracts males, and swarming of males has been observed around these females (Harris et al.,
1996). It is likely that male dispersal is strongly affected by the location of females. Multiple
mating by males is common (Suckling et al. 2007), and so a single male can mate with several
females that may emerge together. Each female may lay up to 200 eggs (HortResearch, 1999).
801.
This scientific evidence makes it clear that there is ample time for the requisite number of
adult ALCM to emerge and mate within their short life time. The IRA Team’s consideration was
1007
Exhibit NZ-18: Barnes (1948).
New Zealand’s first written submission, para. 4.121 (Article 2.2); also, see: para. 4.351.
1009
Exhibit AUS-95: HortResearch (1999), “Apple leafcurling midge” in: BugKey; Insects and mites of
pipfruit and stonefruit. Website: http://www.hortnet.co.nz/key/pipfruit.htm (accessed 31 May 2004).
1010
Exhibit NZ-15: Suckling DM, Walker JTS, Shaw PW, Manning L, Lo P, Wallis R, Bell V,
Sandanayaka WRM, Hall DR, Cross JV & El-Sayed AM (2007), “Trapping Dasineura mali (Diptera:
Cecidomyiidae) in Apples”, Journal of Economic Entomology 100(3), p. 746.
1008
247
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
based on the reasonable premise that large quantities of apples would be transported to utility
points in proximity to host apple trees, such as orchard packing houses, and that it was plausible
that a sufficient number of male and female adults would emerge together. A population of
ALCM could feasibly start from eggs laid by a single female.
iii.
ALCM will not need to fly far from orchard packing houses to find a
suitable host
802.
In relation to potential ALCM flying distances, New Zealand claims that “the IRA
ignored those findings [of Suckling et al. (2007)] in its evaluation of the proximity of ‘utility
points’ to available hosts.”1011 New Zealand relies on Suckling et al. (2007) to assert that male
ALCM can fly only 30 metres, and mated females even less.1012 New Zealand suggests that the
IRA Team “appear[ed] to base its calculations on a flight range for ALCM of up to 200
metres”.1013
803.
However, although the Final IRA Report does refer to the fact that “[ALCM] were
detected in a block of newly established apple trees at 200 metres from the source (the furthest
distance tested)”1014, the IRA Team did not place much weight on this figure, reflected by the
fact it is not referred to in their main discussion of adult flight distances.1015 The IRA Team
relied upon evidence from Cross (2005), Suckling et al. (2007)1016 and HortResearch (1999b).1017
804.
In any event, the figure of 30 metres drawn from Suckling et al. (2007) is based on shoot
infestation of new apple trees adjacent to a mature infested block. The shoot infestation rate
declines rapidly over the first 30 metres into the new block but there is still an underlying rate of
infestation up to 200 metres into the new block which the authors put down to ALCM being
moved into the new block on new trees and their associated soil. However, the IRA Team
New Zealand’s first written submission, para. 4.353.
New Zealand’s first written submission, paras. 4.123, 4.353.
1013
New Zealand’s first written submission, para. 4.353.
1014
Final IRA Report, Part B, p. 168.
1015
Final IRA Report, Part B, p. 171.
1016
Although the Final IRA Report refers to “Suckling et al. (2006)”, this is the same research as that
referred to by New Zealand (Exhibit NZ-15: Suckling DM, Walker JTS, Shaw PW, Manning L, Lo P, Wallis R,
Bell V, Sandanayaka WRM, Hall DR, Cross JV & El-Sayed AM (2007), “Trapping Dasineura mali (Diptera:
Cecidomyiidae) in Apples”, Journal of Economic Entomology 100(3)). The IRA Team was provided with an
advance copy of the material before it was published.
1017
See: Final IRA Report, Part B, p. 171.
1011
1012
248
Australia – Apples (DS367)
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18 July 2008
reasoned that it is also likely that some of the shoot infestations up to 200 metres were caused by
immigrants from the adjacent infected orchard block. Information from Cross (2005)1018 claimed
that significant numbers of male ALCM were caught at all distances up to 50 metres when
testing sex pheromone traps. Indeed, the numbers caught at 50 metres were still significant
(several per day); the distances beyond 50 metres were not investigated, suggesting that 50
metres was not a maximum distance.
805.
In any event, it is ultimately female flight that matters for establishment once mating has
occurred. If a sufficient number of adult ALCM emerge at about the same time from the same
collection of apples, then little flight may be required in order for mating to occur. Females are
attracted to the volatile chemicals released by actively growing apple shoots on which to lay their
eggs.
806.
New Zealand’s claim is predicated on the basis that ALCM has to physically fly the
distance to locate hosts but the IRA Team considered that it is equally probable that a gust of
wind or other mechanical means can give the ALCM a further boost to its flight range.
HortResearch (1999) notes that “some researchers consider them strong fliers able to disperse
well in wind, and [ALCM] has a history of rapid spread when introduced to new areas.”1019
807.
An extreme example of how insects can be blown long distances is a recent establishment
of lettuce aphid in Tasmania from New Zealand. According to media reports, the establishment
of lettuce aphids was attributed to unusual weather patterns. The aphids travelled a distance of
over 2,600 kilometres from New Zealand to Tasmania on an easterly air stream.1020
808.
In any event, a flight range of 30-50 metres for a mated female ALCM would be ample in
many cases between an orchard packing house co-located within an apple orchard. New Zealand
has provided no evidence to demonstrate that such a flight distance would be insufficient for
adult ALCM to travel from their point of escape at a utility point to a host.
1018
Exhibit AUS-96: Cross, J. (2005) Personal communication from Jerry Cross of East Malling
Research, Kent, UK on apple leaf curling midge, 30 March 2005.
1019
Exhibit AUS-95: Hortresearch (1999).
1020
Exhibit AUS-97: Courtney P (2005), “Scientist battles lettuce aphid” (Landline, ABC), at website:
http://www.abc.net.au/landline/content/2005/s1493620.htm (accessed 9 July 2008); ABC Rural News (2004), at
website: http://www.abc.net.au/rural/news/stories/s1179390.htm (accessed 9 July 2008).
249
Australia – Apples (DS367)
iv.
809.
Australia’s First Written Submission of Australia
18 July 2008
Conclusion on establishment
New Zealand has failed to show that the IRA Team did not properly evaluate the
scientific evidence available in respect to the limitations imposed on the potential establishment
of ALCM in Australia by its limited life span and flight range or that the probability values
chosen by the IRA Team were without sufficient basis. New Zealand has failed to establish any
flaws in the IRA Team’s assessment on establishment.
(c)
810.
The IRA Team’s analysis of probability of spread is objective and credible
The IRA Team considered factors relevant to the movement of the pest from a point of
establishment on an exposed plant, or group of plants, to susceptible plants in other parts of
Australia.1021 The IRA Team noted that ALCM would not require a vector for its spread because
it is capable of independent flight.1022 Australia notes that New Zealand does not challenge the
IRA Team’s evaluation of spread under Article 2.2.
811.
Under Article 5.1, New Zealand claims:
Even if ALCM were to establish in Australia, the likelihood of spread is
remote. ALCM distribution and pest status appears to be limited to cooler
wetter climatic conditions, such as those found in temperate coastal regions
(Rogers 2006: 1).1023
812.
It is clear that the IRA Team took into account climate-related issues for spread. In its
assessment of spread, the IRA Team considered that:
Apple leafcurling midge has spread all over New Zealand since its accidental
introduction in about 1950. There are similar environments in Australia that
would be suitable for its spread.1024
813.
Australian states such as Victoria, Tasmania and New South Wales have the types of cool
climate suited to the establishment and spread of ALCM, and a considerable proportion of
Australia’s commercial apple producing regions are situated in such regions.
814.
New Zealand further claims that “it is highly unlikely that [ALCM] would become
successfully established in all of the areas where apples are grown commercially and where
1021
Final IRA Report, Part B, pp. 177-178.
Final IRA Report, Part B, pp. 177-178.
1023
New Zealand’s first written submission, para. 4.364
1024
Final IRA Report, Part B, p. 177.
1022
250
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
apple trees are grown in domestic gardens.”1025 The IRA Team’s assessment of the probability
of spread did not assume that ALCM would necessarily spread to all apple growing areas and
gardens of Australia, nor should it have done. “Spread” will have been achieved if the pest
spreads beyond its place of establishment to any other part of Australia.
815.
New Zealand has failed to establish any flaws in the IRA Team’s assessment of the
likelihood of spread of ALCM in Australia.
i.
The general plausibility of the scenario of entry, establishment & spread
of ALCM
a.
New Zealand’s claim that the scenario could not happen in the
real world ignores available precedents in the international
spread of pests via trade
816.
New Zealand claims:
Even if apples infested with live pupae were to enter Australia, the live pupae
would need to develop and emerge from cocoons simultaneously in sufficient
numbers near enough to each other for the males readily to locate females and
mate. Further, the mated female, with a limited flight range, would need to
find young actively growing apples leaves on which to lay its eggs. This
would all need to occur in the very short life span of an adult ALCM
(approximately 3-4 days under laboratory conditions: Barnes 1948: 36). There
is no scientific evidence that this has ever occurred, or could occur in the real
world.1026
817.
New Zealand’s claim that such events have never occurred, nor could they occur in the
real world, begs the question how New Zealand accounts for ALCM clearly managing to
reproduce and survive since it first evolved and spread across the world.
818.
A recent example of how insects can be spread to other countries via apples from New
Zealand was the discovery that wheat bug (Nysius huttoni) had established in the Netherlands
and Belgium (Aukema et al. 20051027). Wheat bug is native to New Zealand, and had not
previously been reported outside New Zealand. Although wheat bug is not a pest of apple fruit
New Zealand’s first written submission, para. 4.365. (emphasis added)
New Zealand’s first written submission, para. 4.116 (Article 2.2). Also, see: para. 4.351.
1027
Exhibit AUS-98: Aukema B, Bruers JM & Viskens G, (2005) “A New Zealand endemic Nysius
established in the Netherlands and Belgium (Heteroptera: Lygaeidae), Belgian Journal of Entomology 7, pp. 37-43.
1025
1026
251
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
or trees, it is a potential hitchhiker or contaminant pest insect of exported commodities.1028 It has
occasionally been detected in shipments of stone fruit from New Zealand to Australia.1029
According to the alert issued by the European and Mediterranean Plant Protection Organization,
“N. huttoni is reported as being a contaminating pest often found on apple fruit packages
exported from New Zealand” and “[i]t may have to be recognised that it will be difficult to
prevent its further spread, as N. huttoni is polyphagous, spreading naturally and is most likely a
contaminant of many traded products.”1030 The fact that other insects, such as wheat bug, can be
imported via fruit from New Zealand supports the view of the IRA Team that the unrestricted
importation of New Zealand apples to Australia poses a legitimate risk that ALCM will enter,
establish and spread in Australia.
b.
819.
New Zealand’s Chinese Taipei example is irrelevant
New Zealand has relied upon the history of its apple exports to Chinese Taipei in support
of its claim the ALCM would not enter, establish or spread in Australia from New Zealand
apples. New Zealand claims that:
New Zealand has, over the last 18 years, exported over 800 million apples,
sourced from throughout the country, to Chinese Taipei, with no special
measures for ALCM. Chinese Taipei remains free of this pest.1031
820.
New Zealand’s assertion is unsupported by any evidence or explanation as to why certain
conclusions as to pest risks should be drawn from this trading history. Nor has New Zealand
explained how the New Zealand-Australia scenario might be comparable to the New ZealandChinese Taipei situation. As is clear from the complexity of the IRA Team’s analysis of
exposure and proximity likelihoods, there are a large number of environmental, geographic,
climatic, commercial production and other factors (such as the availability of suitable hosts)
which are specific to the importing country, that may go to explaining any failure of ALCM to
establish and spread in that country. New Zealand has offered no analysis of these factors in
respect of Chinese Taipei.
1028
See: Final IRA Report, Part B, p. 323.
Exhibit AUS-99: Australian Quarantine & Inspection Service (2008), Data extracted from the AQIS
Pest and Disease Interception database and provided by the Senior Entomologist, AQIS Operational Science
Program (9 July 2008).
1030
Exhibit AUS-100: European and Mediterranean Plant Protection Organization (2006), “First report of
Nysius huttoni in the Netherlands and Belgium: addition to the EPPO Alert List”, EPPO RS 2006/030, February
2006: http://archives.eppo.org/EPPOReporting/2006/Rse-0602.pdf (accessed 9 July 2008).
1031
New Zealand’s first written submission, para. 4.133. (footnote omitted)
1029
252
Australia – Apples (DS367)
821.
Australia’s First Written Submission of Australia
18 July 2008
Australia submits that the failure of ALCM to establish is most likely due to Chinese
Taipei’s climatic conditions not being suitable for this pest’s establishment, rather than because
there may be insufficient numbers of ALCM infesting New Zealand apples. Chinese Taipei has
an oceanic and subtropical monsoon climate. The average lowland temperature in January is
16°C in the north and 20°C in the south; the average July temperature is 28°C in both the north
and south.1032 ALCM is a pest of cool climates.1033 Indeed, New Zealand uses a similar
argument to say that it is highly unlikely that ALCM would establish or have any pest status in
the areas of Australia which may not have suitable climatic conditions.1034 Chinese Taipei is
located around the Tropic of Cancer; comparable southern latitudes to this would lie somewhere
between Mackay and Bundaberg in Queensland (Tropic of Capricorn) – which are much further
north than where apples are grown commercially in Australia.
822.
New Zealand has even failed to provide the basis for its assertion that Chinese Taipei is
“free of this pest”. New Zealand has not advised whether Chinese Taipei authorities conduct
surveys or otherwise have mechanisms that would be likely to detect ALCM.
Australia
understands that ALCM is not specified as a “quarantine pest” in Chinese Taipei.
ii.
823.
Conclusion on entry, establishment and spread
New Zealand’s attempt to undermine the IRA Team’s assessment of the likelihood that
ALCM may enter, establish and spread in Australia by declaring that certain events are
impossible or could never occur is clearly divorced from the reality that ALCM has successfully
done so in many areas of the world.
824.
New Zealand has not established either that the IRA Team failed to take into account
particular relevant evidence or that its reasoning was flawed in relation to any stage of its
analysis.
Far from establishing that the risk is “negligible”1035 (in accordance with New
Zealand’s meaning of the term), New Zealand has demonstrated its own failure to correctly
interpret the scientific evidence or to understand the methodology applied by the IRA Team to its
1032
See, website: http://www.nationsencyclopedia.com/Asia-and-Oceania/Taiwan-CLIMATE.html
(accessed 10 July 2008).
1033
See: New Zealand’s first written submission, para. 4.364.
1034
New Zealand’s first written submission, para. 4.365.
1035
New Zealand’s first written submission, paras. 4.132 & 4.517.
253
Australia – Apples (DS367)
assessment of the unrestricted risk.1036
Australia’s First Written Submission of Australia
18 July 2008
Australia submits that New Zealand has failed to
establish any flaws, let alone any flaws serious enough to prevent the Panel from having
“reasonable confidence” in the Final IRA Report.
(d)
825.
The IRA Team’s analysis of potential consequences is objective and credible
Under Article 5.1, New Zealand has also challenged certain aspects of the IRA Team’s
assessment of the potential biological and economic consequences of an ALCM incursion.
Australia notes that New Zealand has not challenged the issue of consequences under Article 2.2.
826.
New Zealand claims that:
… Australia’s purported analysis of the “associated potential biological and
economic consequences” of ALCM constitutes nothing more than a listing of
unsubstantiated assumptions. It is not an evaluation of those consequences
within the meaning of the SPS Agreement.1037
827.
New Zealand relies heavily on the paper by Rogers et al. (2006) in support of a large
number of its assertions in respect of consequences.1038 New Zealand relies on the paper in
respect of the effects of the integrated fruit production programme on ALCM in New Zealand,
pest severity on young trees and chemical control of ALCM.1039 But the Rogers et al. (2006)
study focussed on the proportion of unoccupied cocoons on apples and the mortality status of
pre-pupal ALCM in remaining cocoons.1040 It is clearly not a primary source of evidence for the
assertions made by New Zealand in respect of consequences. Accordingly, the Panel should
attribute little weight to the evidence presented by New Zealand on these issues.
828.
Australia also notes that New Zealand does not challenge any of the “impact scores”
allocated by the IRA Team to potential consequences. In fact, it is quite unclear what aspect(s)
of the IRA Team’s analysis New Zealand is actually challenging. New Zealand appears to blur
the different aspects of the IRA Team’s methodological approach to the consequences analysis
for ALCM. New Zealand’s claim that “there is simply no evidence that the consequences
An example of this is New Zealand’s repeated factoring in of a potential 600-unit inspection risk
management measure: New Zealand’s first written submission, paras. 4.127-4.132, 4.137 (Article 2.2), 4.346, 4.360
& 4.517.
1037
New Zealand’s first written submission, para. 4.377.
1038
New Zealand’s first written submission, paras. 4.367-4.368 & 4.371.
1039
See: New Zealand’s first written submission, paras. 4.367-4.371.
1040
Exhibit NZ-17: Rogers et al. (2006).
1036
254
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
foreseen by the IRA would occur”1041 fails to address the evidence relied upon in the Final IRA
Report.
i.
829.
Plant life or health
New Zealand claims that “the data used by Australia to assess the impact of ACLM [sic]
on plant life and health is now over ten years old and has no validity under today’s protection
practices.”1042 However, New Zealand criticises the reliance upon Smith and Chapman (1995) in
this context,1043 even though the IRA Team took into account at least two other sources.1044
830.
Smith and Chapman (1995) conducted a survey of 30 apple orchards in the Nelson area
of New Zealand in order to rank the most important arthropod pests and measure perceptions of
the relative importance of ALCM. The results indicated that 33% of growers ranked ALCM
alone, 17% ranked ALCM and mites together, and 17% ranked ALCM, leafroller and mites
altogether as being the most serious arthropod pests, with 63% of growers considering that
ALCM adversely affects plant health.1045 This indicates that ALCM was indeed a serious pest
for New Zealand apple growers, at least in the 1990s. New Zealand has failed to provide any
actual evidence that New Zealand growers would assign different impact rankings in respect to
ALCM today compared to those ascertained by Smith and Chapman (1995).
831.
New Zealand refers to the introduction in New Zealand of the integrated fruit production
programme as being a reason that the significance of ALCM may have decreased since the study
by Smith and Chapman (1995).1046 However, no such programme for ALCM exists in Australia,
and so the Smith and Chapman (1995) results remain relevant for the Australian situation.
832.
New Zealand relies heavily on Rogers et al. (2006) in support of most of its assertions,
including that “[g]rowers would be very unlikely to assign the same impact rankings to ALCM
today”, compared to those ratings reflected in the Smith and Chapman (1995) report, and that
New Zealand’s first written submission, para. 4.373.
New Zealand’s first written submission, para. 4.367.
1043
See: New Zealand’s first written submission, para. 4.367.
1044
See: Final IRA Report, Part B, pp. 184-185.
1045
Exhibit AUS-101: Smith, J.T. and Chapman, R.B. (1995) “A survey of apple leafcurling midge
(Dasyneura mali) in the Nelson District”, Proceedings of the 48th New Zealand Plant Protection Conference, pp.
117-120.
1046
New Zealand’s first written submission, paras. 4.367-4.368.
1041
1042
255
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
“[i]n New Zealand ALCM is an important pest solely in respect of young apple trees”.1047
Australia has explained above why the Rogers et al. (2006) provides inadequate support for New
Zealand’s assertions. In any event, the Rogers et al. (2006) paper refers to “Nelson orchards
with uncharacteristically high levels of ALCM during 2005”1048, which indicates that New
Zealand continues to have problems with high levels of ALCM in New Zealand even since the
introduction of the integrated fruit production programme.
833.
It is clear that the IRA Team were primarily focussed on consequences for young trees:
[ALCM] is a specialist herbivore restricted to apple trees. It affects crown
formation of young apple trees in the first stages of development, but mature
trees are able to tolerate normal population levels. Damage to young leaves
would provide opportunities for entry of plant pathogens.1049
834.
New Zealand has failed to provide any evidence or argument to suggest that ALCM
would not become a major problem in Australian orchards should it become established, just as
it was a major problem when ALCM first arrived in New Zealand.
ii.
835.
Impact across Australia
New Zealand claims that, “[b]ecause of the limited climatic range of ALCM, the IRA is
incorrect in its use of the concept of ‘all of Australia’ when referring to the impact on regions
where apples may be grown either commercially or domestically.”1050 It is unclear to Australia
to what New Zealand is referring. The consequences analysis for ALCM in the Final IRA
Report does not refer to “all of Australia” anywhere.1051 In fact, it is clear from the Final IRA
Report that the IRA Team did not consider the potential consequences would be “discernible at a
national level”, but would only have significance at the regional and local levels.1052
See: New Zealand’s first written submission, paras. 4.367-4.368.
Exhibit NZ-17: Rogers et al. (2006), p. 1.
1049
Final IRA Report, Part B, p. 184.
1050
New Zealand’s first written submission, para. 4.369.
1051
Australia acknowledges that, on page 168 of the Final IRA Report, in the discussion on proximity
(relating to the probability of entry, establishment and spread), the IRA Team referred to taking an “average for all
of Australia”. However, this reference is quite distinct from the IRA Team’s analysis of the consequences of an
ALCM incursion.
1052
See: Final IRA Report, Part B, pp. 184-187.
1047
1048
256
Australia – Apples (DS367)
836.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand further asserts that, “ALCM establishment in Australia will be limited by
geographical and climatic barriers.”1053 New Zealand fails to establish the relevance of its
assertion, or its reference to the alleged failure of ALCM to establish in certain parts of the
United States1054, in the context of the IRA Team’s consequences analysis.
837.
In any event, in the consequences analysis, the IRA Team clearly did not assume that
ALCM would necessarily become successfully established in all of the areas where apples are
grown commercially in Australia.
iii.
838.
Use of insecticides & other production-related consequences
New Zealand claims:
The IRA claims that an indirect consequence of the establishment of ALCM
would be an increase in the use of insecticides, disruption of existing pest
management programs, increases in control measures and increased costs to
producers. Once again, the IRA fails to look at actual experience in dealing
with ALCM.1055
839.
According to the Final IRA Report, the IRA Team considered that “an increase in the use
of insecticides for control of [ALCM] because of difficulties involved in estimating optimum
times for insecticide application” may be an indirect consequence in relation to the eradication or
control of ALCM in Australia.1056
The basis for New Zealand’s claim is that, “[i]n New
Zealand, chemical control of ALCM is required only on nursery stock or recently planted apple
trees (Rogers et al. 2006)”, and that “[t]here is no industry requirement for insecticidal controls
for [ALCM] on producing trees.”1057
840.
Australia has already explained why New Zealand’s reliance upon the report by Rogers et
al. (2006) in this context is misplaced. In any event, it is inappropriate for New Zealand to
attempt to draw a direct analogy between New Zealand’s current and well-established practices
for managing ALCM, and the management practices that may have to be newly implemented in
Australia if ALCM was to establish. New Zealand has been managing ALCM since the 1950s.
A more appropriate analogy would be New Zealand’s practices early in the period that ALCM
New Zealand’s first written submission, para. 4.375.
New Zealand’s first written submission, para. 4.375.
1055
New Zealand’s first written submission, para. 4.370.
1056
Final IRA Report, Part B, p. 185.
1057
New Zealand’s first written submission, para. 4.371.
1053
1054
257
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
was first introduced. It is clear that chemical control programs have been used to control ALCM
in New Zealand, particularly early on.1058 Furthermore, it is commonly accepted that invasive
species do not necessarily behave in the same way when they are introduced to different parts of
the world, which may necessitate different approaches to eradication or control in different
situations.
841.
Australia submits that New Zealand’s assertion that there would be no increase in the use
of insecticides in Australia is contradicted by the information supplied on the website of the
Horticulture and Food Research Institute of New Zealand Ltd, which states:
Since the 1960s, chemical control of apple leafcurling midge has been based
on the use of organophosphates. These highly toxic chemicals have provided
effective control of apple leafcurling midge and other pests but they have had
the disadvantage of toxicity to many natural enemies. More recently, insect
growth regulator compounds have been developed for insect control. These are
more selective chemicals usually allowing survival of many natural enemies.
Unfortunately, there is no insect growth regulator yet developed which is
effective against apple leafcurling midge, and chemical control still relies on
organophosphates. The apple leafcurling midge parasite, Playgaster demades,
is so important for control of this pest in IFP [integrated fruit production] and
organic production that every effort is now being made to eliminate the use of
chemical control, and to rely instead on biological control for this pest.1059
842.
Furthermore, it would not be appropriate to compare the costs of ALCM control in New
Zealand, where it has been established for over 55 years, to the potential control costs that
Australia would need to mount in the event that ALCM became established. The costs of trying
to eradicate an ALCM incursion in the first instance in Australia could be significant. Australia
notes that New Zealand has incurred significant costs as a result of trying to manage incursions
of exotic pests, for example painted apple moth and Asian gypsy moth.1060
iv.
843.
Use of biological predators to contribute to effective biological control
New Zealand claims that potential predators of ALCM occur in Australia that could
contribute to the biological control of ALCM if it became established.1061
1058
1059
Exhibit NZ-43: Tomkins et al. (1994); Exhibit NZ-44: Todd (1959).
See, website: http://www.hortnet.co.nz/key/keys/info/control/almcontr/alm-chem.htm (accessed 10 July
2008).
1060
See, websites: http://www.cbd.int/doc/submissions/ias/ias-nz-moth-2007-en.pdf;
http://www.biosecurity.govt.nz/pests/plants/investigation-moth-spraying-qa;
http://www.peoplesinquiry.co.nz/content/view/1/1/.
1061
New Zealand’s first written submission, para. 4.372.
258
Australia – Apples (DS367)
844.
Australia’s First Written Submission of Australia
18 July 2008
Australia notes that the known natural enemies of ALCM in New Zealand include birds,
European earwig, a predatory mirid bug and a predatory mite,1062 all of which are present in
Australia.1063 However, it was not possible for the IRA Team to assess the degree to which these
potential predators present in Australia would prove effective against ALCM under Australian
conditions. New Zealand suggests that they “probably contribute to existing biological control
programmes”,1064 but provides no evidence in support of its assertion or its assertion that they
will be effective as biological control agents against ALCM in Australia.
845.
The anthocorid bug (pirate bug) and a parasitoid wasp Platygaster demades (Walker) are
both predators of ALCM that are present in New Zealand, but not in Australia.1065
846.
Australia notes that the main biological control agent of ALCM in New Zealand, the
parasitoid wasp P. demades, has a restricted degree of effectiveness. Todd (1959) observed that
P. demades fails to check the second generation of ALCM in New Zealand which restricts its
effectiveness as a controlling agent.
1066
This failure to control the second generation of ALCM
was investigated more recently by Shaw et al. (2005).1067 Peak parasitoid trap-catches coincided
with ALCM egg-laying peaks in generations one, three and four. However, second generation
parasitoid numbers were very low. This would seem to indicate that P. demades is not a good
controlling agent.
Shaw et al. (2005) concluded that, “these results indicate that despite
considerable levels of parasitism, ALCM populations can remain high and bio-control by
P. demades is compromised by the asynchrony of host and parasitoid populations during the
second generation.”1068
v.
847.
Impact on trade
New Zealand claims:
The presence of ALCM in New Zealand has no major impact on apples
exports. New Zealand regularly exports apples to ALCM sensitive markets,
e.g. China, Chinese Taipei, India, and California. When ALCM is detected the
1062
http://www.hortnet.co.nz/key/keys/info/enemies/alm-enem.htm.
See: Final IRA Report, Part C, pp. 48, 62 & 86.
1064
New Zealand’s first written submission, para. 4.372.
1065
See: Final IRA Report, Part C, pp. 57 & 68.
1066
Exhibit NZ-44: Todd (1959).
1067
Exhibit NZ-16: Shaw (2005).
1068
Exhibit NZ-16: Shaw (2005).
1063
259
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
consignment is fumigated; New Zealand apple consignments have never been
rejected because of the presence of ALCM.1069
848.
However, New Zealand has not specified the nature of the “sensitivity” of other markets
to ALCM, or how New Zealand addresses those sensitivities. For example, in simply making
reference to “California”, New Zealand has not been explicit about the fact that there is an
extensive and intensive regulatory program required by the United States authorities for its apple
exports1070, reflected in the detailed official guidance provided to New Zealand apple
exporters.1071 Additionally, the documentation that accompanies New Zealand apple shipments
must include a “statement [that] will cite whether midges were found during inspection.”1072
849.
The IRA Team relied upon information from the export program for New Zealand apple
exports to the United States, as well as the technical information available from Lowe (1993),1073
that suggested that New Zealand fruit may be rejected for pre-clearance export to Japan if found
to be infested with ALCM.1074 The report by Suckling et al. (2007) also refers to the impact the
presence of [ALCM] cocoons on fruit can have on restricting market access 1075, and Tomkins
(1998)1076 notes that fruit contaminated by pupal cocoons may be rejected for export.
New Zealand’s first written submission, para. 4.376.
See: Exhibit AUS-102: United States Department of Agriculture, Fresh Fruits and Vegetables Import
Manual, 06/2008-35, 06/2008-48, pp. 2.36-2.37, 2.49, 3.216-3.217. The manual is available in full from the website:
http://www.aphis.usda.gov/import_export/plants/manuals/ports/downloads/fv.pdf (accessed 10 July 2008).
1071
United States Department of Agriculture & New Zealand Ministry of Agriculture and Forestry (2007),
Technical work plan for the USDA pre-export inspection of New Zealand pipfruit (apples, European pears & nashi)
exported
to
the
United
States
of
America,
February
2007;
available
at
website:
http://www.biosecurity.govt.nz/commercial-exports/plant-exports/compliance-programmes/usda-pipfruit (accessed
10 July 2008).
1072
See: Exhibit AUS-102: United States Department of Agriculture, Fresh Fruits and Vegetables Import
Manual, 06/2008-35, pp. 2-36.
1073
Lowe, S (1993) “Apple leafcurling midge”, New Zealand Apple and Pear Marketing Board: Pipmark
Technical Bulletin. As explained above, Australia is not in a position to provide this document to the Panel as an
exhibit. However, Australia notes that the findings of Lowe (1993) have been referred to in a number of other
scientific papers, including: Exhibit AUS-103: Harris MO, Foster SP, Agee K & Dhana S, (1996) “Sex pheromone
communication in the apple leafcurling midge (Dasineura mali)”, Proceedings of the 49th New Zealand Plant
Protection Conference 1996, p. 52; Exhibit NZ-43: Tomkins AR, Wilson DJ, Hutchings SO & June S (1994) “A
survey of apple leafcurling midge (Dasyneura mali) management in Waikato orchards”, Proceedings of the 47th New
Zealand Plant Protection Conference, 346; Exhibit NZ-17: Rogers DJ, Walker JTS & Cole LM (2006), “Apple
leafcurling midge cocoons on apple: pupal occupancy and mortality”.
1074
Final IRA Report, Part B, p. 186. The IRA Team also relied upon: Exhibit AUS-104: Anonymous
(2002)
1075
Exhibit NZ-15: Suckling DM, Walker JTS, Shaw PW, Manning L, Lo P, Wallis R, Bell V,
Sandanayaka WRM, Hall DR, Cross JV & El-Sayed AM (2007), “Trapping Dasineura mali (Diptera:
Cecidomyiidae) in Apples”, Journal of Economic Entomology 100(3), p. 745.
1076
Exhibit AUS-89: Tomkins AR (1998), “Apple leaf-curling midge life cycle”, HortFACT, (Horticulture
and Food Research Institute of New Zealand Ltd).
1069
1070
260
Australia – Apples (DS367)
vi.
850.
Australia’s First Written Submission of Australia
18 July 2008
Conclusion on consequences
New Zealand’s challenge to the IRA Team’s evaluation of the biological and economic
consequences of an ALCM incursion in Australia is imprecise and unsubstantiated. Once again,
New Zealand has failed to appreciate the methodology used by the IRA Team to make its
assessment. New Zealand has failed to identify any evidence that the IRA Team did not take
into account or that there were any flaws in its evaluation.
(e)
Conclusion: New Zealand fails to discredit the IRA Team’s assessment on
ALCM
851.
Australia submits that the IRA Team properly evaluated the likelihood of entry,
establishment and spread of ALCM, as well as the potential biological and economic
consequences. New Zealand has therefore failed to demonstrate any flaws in the Final IRA
Report, let alone flaws that were “so serious” that it should prevent the Panel from having
reasonable confidence in the evaluation made. In any event, Australia has demonstrated that the
IRA Team properly evaluated risk and applied its expert judgment rigorously to arrive at an
objective and credible assessment for ALCM. Accordingly, the risk assessment is consistent
with Article 5.1 of the SPS Agreement.
261
Australia – Apples (DS367)
6.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team made an objective and credible evaluation of the likelihood of entry,
establishment and spread according to the SPS measures which might be applied
(a)
New Zealand has failed to show that any measures not evaluated are SPS
measures
852.
New Zealand claims that the risk assessment relied upon by Australia failed to evaluate
the likelihood of entry, establishment or spread “according to the [SPS] measures which might
be applied” (Annex A(4)).1077 According to New Zealand:
While the IRA identifies various different risk reduction factors for the three
pests at issue, it only provides “some” evaluation of the extent to which these
factors could reduce risk, particularly in relation to fire blight. Further, the
IRA fails to provide any evaluation of a particular measure proposed by New
Zealand. Accordingly, it is not an evaluation of the likelihood of entry,
establishment or spread of the three pests according to the SPS measures which
might be applied within the meaning of Article 5.1.1078
853.
Australia submits that the IRA Team clearly evaluated the scientific and technical
efficacy of the principal measures recommended to reduce the risks of the relevant pests to
achieve Australia’s ALOP, along with evaluating a number of other potential risk management
alternatives.1079
854.
At the outset, Australia notes that the obligation at issue only relates to the evaluation of
SPS measures. New Zealand must show that any “measures” allegedly not evaluated are indeed
SPS measures. Australia submits that New Zealand has failed to establish that any of the
“measures” allegedly not evaluated are “SPS measures” within the meaning of Annex A(1) of
the SPS Agreement.
(b)
The IRA Team correctly evaluated the risk reduction measures
i.
855.
Only measures which reduce risk need to be substantively evaluated
On the basis of the definition of “risk assessment” provided in Annex A(4), the Appellate
Body explained that a valid risk assessment must:
New Zealand’s first written submission, paras. 4.158, 4.383.
New Zealand’s first written submission, para. 4.383.
1079
This is acknowledged by New Zealand at: New Zealand’s first written submission, paras. 4.385 &
1077
1078
4.394.
262
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18 July 2008
… evaluate the likelihood of entry, establishment or spread of [the relevant
pest or disease] according to the SPS measures which might be applied.1080
856.
New Zealand refers to the Appellate Body’s reasoning in Australia – Salmon and its
finding that, although the risk assessment in question examined a large number of potential risk
reduction measures, the consideration of the SPS measures which might be applied was
inadequate in that case because there was only “some” evaluation of the extent to which those
factors could reduce the risk.1081 New Zealand seems to assert that the IRA Team’s alleged
failure to evaluate certain of the requirements for fire blight, European canker and some general
requirements is analogous to the situation in Australia – Salmon.1082
857.
However, Australia submits that the Appellate Body’s reasoning does not imply that
there is an obligation to evaluate every single requirement that is actually imposed, whether it is
a principal measure or merely an ancillary requirement. In its reasoning, the Appellate Body
focussed on whether the risk reduction measures at issue were evaluated for their effectiveness in
reducing the “total risk”.1083 The panel had found that “the 1996 Final Report identifies such
measures but does not, in any substantial way, evaluate or assess their relative effectiveness in
reducing the overall disease risk.”1084
858.
It is clear that the panel, and therefore the Appellate Body, was referring to the principal
risk reduction measures (those that are to reduce risk) for the product at issue1085, and not merely
any ancillary requirements to support, verify or operationalise the principal risk reduction
measures.
Therefore, Australia submits that the Appellate Body’s reasoning is limited to
whether principal risk reduction measures are evaluated in a sufficiently substantial way in a risk
assessment. New Zealand has not alleged that any of the principal risk reduction measures
applied by Australia were not properly evaluated by the IRA Team.
Appellate Body Report, Australia – Salmon, para. 121. (original emphasis)
Appellate Body Report, Australia – Salmon, paras. 132-134. (Referred to by New Zealand at para.
4.380 of its first written submission; however, Australia notes that New Zealand has misquoted the Appellate Body
in its para. 4.380.)
1082
New Zealand’s first written submission, paras. 4.380-4.383.
1083
Appellate Body Report, Australia – Salmon, para. 133.
1084
Appellate Body Report, Australia – Salmon, para. 133 (quoting Panel Report, Australia – Salmon, para.
8.90). (footnote omitted; emphasis removed)
1085
The panel referred to the following “risk reduction factors”: “restricting zone of origin, species of
origin, life cycle stage; pre and post shipping quarantine; product testing with tests having high sensitivity;
processing, maturation and storage for specified time and temperature; treatments, (e.g., heating, disinfection);
restricting the destination; vaccination; and certification.” (Panel Report, Australia – Salmon, para. 8.89.)
1080
1081
263
Australia – Apples (DS367)
859.
Australia’s First Written Submission of Australia
18 July 2008
Australia’s view is supported by the Appellate Body’s statement that, “[w]e agree with
the Panel that the measures which might be applied are those which reduce the risks of
concern”.1086 Thus, the measures which are required to be examined are those which actively
reduce the risks of concern – i.e. the principal risk reduction measures – rather than those
measures which do not actually reduce the risks themselves, but are required simply to support,
verify and operationalise the principal risk reduction measures.
ii.
860.
Evaluation should not be limited to those measures already in place
New Zealand also refers1087 to the Appellate Body’s statement in Japan – Apples that “a
risk assessment should not be limited to an examination of the measure already in place or
favoured by the importing Member.”1088 Australia notes that the Appellate Body made this
statement in the context of agreeing with the panel that “it would [not] be sufficient … to simply
consider the particular measures that are already in place, to the exclusion of other possible
alternatives”1089, on the basis that:
[T]he evaluation contemplated … should not be distorted by preconceived
views on the nature and the content of the measure to be taken; nor should it
develop into an exercise tailored to and carried out for the purpose of justifying
decisions ex post facto.1090
861.
Although New Zealand alleges that Australia failed to evaluate a particular measure
proposed by New Zealand1091, it does not suggest that the IRA Team’s evaluation was limited to
a specific set of pre-determined measures or those already in place. It is clear from the Final
IRA Report that a range of potential alternative risk reduction measures was evaluated for each
of the pests at issue in this dispute.1092
(c)
862.
New Zealand’s claims are without basis
New Zealand makes two principal claims in relation to whether the Final IRA Report
evaluated the likelihood of entry, establishment and spread according to the SPS measures which
Appellate Body Report, Australia – Salmon, para. 132. (emphasis added)
New Zealand’s first written submission, para. 4.382.
1088
Appellate Body Report, Japan – Apples, para. 208.
1089
Panel Report, Japan – Apples, para. 8.283. (emphasis added)
1090
Appellate Body Report, Japan – Apples, para. 208.
1091
See: New Zealand’s first written submission, paras. 4.383, 4.397-4.399.
1092
See: Final IRA Report, Part B, pp. 105-116 (fire blight), 150-155 (European canker), 188-192 (ALCM),
& 313-325.
1086
1087
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18 July 2008
might be applied: (i) that there was only “some” evaluation of certain requirements imposed by
Australia; and (ii) that certain measures proposed by New Zealand were not evaluated.1093
i.
Those requirements not evaluated by the IRA Team are not risk reduction
measures
863.
The substance of New Zealand’s first claim rests on the alleged lack of evaluation by the
IRA Team of the ancillary requirements which act to support, verify and operationalise the
principal risk reduction measures in the Final IRA Report.
864.
New Zealand asserts that the IRA Team did not evaluate the following requirements for
fire blight:
a. The requirement that an orchard/block be suspended for the season on the
basis that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of fire
blight.
b. The requirement that all grading and packing equipment that comes in direct
contact with apples be cleaned and disinfected (using an approved disinfectant)
immediately before each Australian packing run.
c. The requirement that packing houses registered for export of apples process
only fruit sourced from registered orchards.1094
865.
None of these requirements “operates in some concrete way in its own right”1095 to
reduce the risks associated with fire blight. Each of the requirements is imposed to support,
verify and operationalise the principal risk management measures imposed pursuant to the
systems approach for fire blight (i.e. orchards free from symptoms plus disinfection treatment).
866.
In respect of the measures for European canker, New Zealand challenges:
a. The requirement that an orchard/block be suspended for the season on the
basis that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of
European canker.
b. The requirement that all new planting stock be intensively examined and
treated for European canker.1096
New Zealand’s first written submission, para. 4.383.
New Zealand’s first written submission, para. 4.386. (footnotes omitted)
1095
Panel Report, US – Export Restraints, para. 8.85.
1096
New Zealand’s first written submission, para. 4.395.
1093
1094
265
Australia – Apples (DS367)
867.
Australia’s First Written Submission of Australia
18 July 2008
As previously explained, Australia does not impose the requirement (a) identified by
New Zealand.
The second requirement is imposed to support, verify and operationalise
Australia’s principal measure for European canker that fruit be sourced only from pest free
places of production.
868.
In respect of the general measures, New Zealand challenges:
a. The requirement that Australian Quarantine and Inspection Service officers
be involved in orchard inspections for European canker and fire blight, in
direct verification of packing house procedures, and in fruit inspection and
treatment.
b. The requirement that New Zealand ensure that all orchards registered for
export to Australia operate under standard commercial practices.
c. The requirement that packing houses provide details of the layout of
premises.1097
869.
As previously explained, these are ancillary requirements which support, verify and
operationalise the principal risk management measures, rather than operate “in some concrete
way in [their] own right”1098 to reduce risk.
ii.
870.
There is no obligation to evaluate any and every potential measure
New Zealand also points to the IRA Team’s discussion of “other potential risk
management measures” for fire blight, which included irradiation and fumigation, arguing that
the risk assessment failed “to evaluate the relative effectiveness in reducing the overall disease
risk of any of these identified measures.”1099 Australia considers New Zealand’s argument to be
rather perplexing. The IRA Team made it clear that “[t]here was insufficient data relevant to fire
blight for the IRA Team to adequately assess the efficacy of these alternatives”, and that “the
proposed measures are always open to review if additional relevant information is
forthcoming”.1100
New Zealand’s first written submission, para. 4.400. (footnotes omitted)
Panel Report, US – Export Restraints, para. 8.85.
1099
New Zealand’s first written submission, paras. 4.388-4.391.
1100
Final IRA Report, Part B, p. 113 (quoted in New Zealand’s first written submission, para. 4.389). The
Final IRA Report also notes more generally that “[i]t is recommended that Biosecurity Australia and AQIS in
consultation with MAFNZ, will review the import requirements after the first year of trade”: Final IRA Report, Part
B, p. 325.
1097
1098
266
Australia – Apples (DS367)
871.
Australia’s First Written Submission of Australia
18 July 2008
New Zealand does not challenge the IRA Team’s opinion that there was insufficient data
available or identify any particular source of data that the IRA Team should have referred to.
Instead, it asserts that:
[T]he IRA’s dismissal of certain measures on the basis that there was
“insufficient data relevant” to “adequately assess the efficacy of these
alternatives” is, itself, inadequate. As noted by the Appellate Body in
Australia – Salmon, the existence of unknown and uncertain elements does not
justify a departure from the requirements of Article 5.1. Australia cannot rely
on “insufficient data” to excuse itself from its obligation to evaluate the
likelihood of entry, establishment or spread of fire blight according to the SPS
measures which might be applied.1101
872.
The IRA Team could not have evaluated the suitability of these potential measures in the
absence of relevant evidence, while complying with its obligation to evaluate measures on the
basis of scientific evidence and principles at the same time. New Zealand’s argument therefore
lacks any merit. In any event, the SPS Agreement does not impose an obligation to evaluate any
and every measure that may potentially reduce a particular risk.
The IRA Team clearly
evaluated a range of potential risk reduction measures for fire blight and did not confine its
evaluation to only those measures that were eventually recommended.1102
873.
Finally, New Zealand asserts that the Final IRA Report failed to properly evaluate the
likelihood of entry, establishment and spread if imports were restricted to “retail ready” apples in
respect of fire blight, European canker and ALCM.1103 The SPS Agreement does not impose any
obligation to evaluate any measures proposed by an exporting country. New Zealand has not
identified any source of such an obligation. For each of the pests at issue, the IRA Team
evaluated a range of potential risk reduction measures that extended beyond those measures
ultimately recommended to achieve Australia’s ALOP.1104
(d)
Conclusion: The IRA Team objectively and credibly evaluated the measures
which reduce risk
874.
Australia submits that the Final IRA Report clearly met the requirement to evaluate the
likelihood of entry, establishment or spread according to the SPS measures which might be
New Zealand’s first written submission, para. 4.392. (footnote omitted)
See: Final IRA Report, Part B, pp. 105-116.
1103
New Zealand’s first written submission, paras. 4.397-4.399.
1104
See: Final IRA Report, Part B, pp. 105-116, 150-155, 188-192, 313-325.
1101
1102
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18 July 2008
applied to reduce the risks of concern.1105 New Zealand has failed to establish that there is an
obligation for a risk assessment to evaluate any and every potential SPS measure which might be
applied. Such a requirement would be impossible for any Member to satisfy. Accordingly, New
Zealand has not established that the Final IRA Report fails to satisfy the third requirement of a
valid risk assessment under the SPS Agreement.
7.
Australia has demonstrated that the Final IRA Report is consistent with Article 5.1
and the third requirement of Article 2.2
875.
Australia submits that the Final IRA Report is a valid risk assessment within the meaning
of Article 5.1 and related provisions of the SPS Agreement. New Zealand has failed to satisfy its
burden to show that those elements of the Final IRA Report relating to the three pests in question
are not objective and credible, that the IRA Team failed to take into account evidence that would
have led to a lower level of assessed risk had it done so, or that any flaws identified are so
serious as to prevent the Panel from having reasonable confidence in the evaluation made.1106
876.
Australia notes that New Zealand does not claim that Australia’s measures are not “based
on” the risk assessment relied upon by Australia. Therefore, given that the Final IRA Report is a
valid risk assessment, Australia submits that the Panel must find that Australia’s measures are
consistent with Article 5.1 of the SPS Agreement and accordingly with the third requirement of
Article 2.2.
1105
1106
See: Appellate Body Report, Australia – Salmon, paras. 121, 132.
See: Panel Report, Australia – Salmon (Article 21.5 – Canada), paras. 7.51 & 7.57.
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18 July 2008
D.
AUSTRALIA HAS ACTED CONSISTENTLY WITH ARTICLE 5.2
1.
New Zealand inappropriately seeks to alter the legal obligation
877.
Article 5.2 of the SPS Agreement elaborates on the factors to be considered in a risk
assessment for the purposes of Article 5.1. Article 5.2 applies to all risk assessments and
identifies seven technical factors that Members must take into account.
878.
According to the panel in US – Continued Suspension:
… taking available scientific evidence into account does not require that a
Member conform its actions to a particular conclusion in a particular scientific
study. The available scientific information may contain a multiplicity of views
and data on a particular topic … the requirement in Article 5.2 is to ensure that
a Member, when assessing risk with the aim of formulating an appropriate SPS
measure, has as wide a range as possible of scientific information before it to
ensure that its measure will be based on sufficient scientific data and supported
by scientific principles.1107
879.
New Zealand quotes part of this passage in apparent agreement1108, yet it argues that the
phrase “to take into account” is equivalent in meaning to the phrase “to give genuine
consideration”.1109 The term to “give genuine consideration” does not appear in Article 5.2 or in
any of the related provisions that form part of its interpretive context.
New Zealand’s
interpretation of the obligation under Article 5.21110 is not grounded in the text of the
SPS Agreement. Australia is concerned by New Zealand’s attempt to convert Article 5.2 into an
obligation that Australia and the IRA Team should have effectively agreed with New Zealand’s
own view of the relevant technical factors listed in the provision.
880.
New Zealand’s position is at odds with the panel’s statement in US – Continued
Suspension that “taking available scientific evidence into account does not require that a Member
conform its actions to a particular conclusion in a particular scientific study.” 1111 Moreover,
New Zealand fails to acknowledge that Article 5.2 is directed at ensuring that a sufficiently wide
range of scientific and other technical information is taken into account in the assessment of
Panel Report, US – Continued Suspension, para. 7.480. (emphasis added)
See: New Zealand’s first written submission, para. 4.408.
1109
See: New Zealand’s first written submission, paras. 4.411, 4.428.
1110
New Zealand’s first written submission, paras. 4.409-4.411.
1111
Panel Report, US – Continued Suspension, para. 7.480. (emphasis added)
1107
1108
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18 July 2008
risks. Article 5.2 is not a vehicle to rehearse arguments about what New Zealand considers to be
sufficient scientific evidence that it should properly have made under Article 2.2 and Article 5.1.
881.
New Zealand claims that the IRA Team failed to take into account the following factors
under Article 5.2: available scientific evidence; relevant processes and production methods;
relevant inspection, sampling and testing methods; prevalence of specific diseases or pests; and
relevant ecological and environmental conditions.1112 On this basis New Zealand asserts that
Australia is in breach of Article 5.2.1113
882.
Australia rejects New Zealand’s assertion that it has acted inconsistently with Article 5.2.
There can be no question that the IRA Team’s comprehensive scientific risk assessment, set out
in the Final IRA Report, is consistent with this obligation as it draws on a wealth of available
scientific and technical information that reflects a wide range of perspectives.1114 Furthermore,
the IRA Team took into account each of factors raised by New Zealand under Article 5.2, as set
out below.
2.
The IRA Team took into account available scientific evidence
883.
New Zealand alleges that the IRA Team “fail[ed] to take into account available scientific
evidence in relation to all three of the pests at issue.”1115 However, New Zealand only cites
examples of this alleged failure in relation to fire blight and European canker. Accordingly,
Australia considers that New Zealand does not contest this issue in relation to ALCM, and it
should not be permitted to expand its claims at a later stage in these proceedings.
i.
884.
Fire blight
New Zealand claims that the Final IRA Report fails to take into account the “scientific
evidence that mature, symptomless apple fruit do not provide a pathway for the transmission of
fire blight”.1116 The sole basis of this claim is as follows:
New Zealand’s first written submission, para. 4.411.
New Zealand’s first written submission, paras. 4.411, 4.416, 4.421, 4.422, 4.423 & 4.427.
1114
In considering the content of the obligation under Article 5.2, Australia suggests the Panel have regard
to the discussion by the panel in EC – Biotech Products in the context of Article 10.1 of the SPS Agreement: Panel
Report, EC – Biotech Products, paras. 7.1620-7.1627.
1115
New Zealand’s first written submission, para. 4.412.
1116
New Zealand’s first written submission, para. 4.412.
1112
1113
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18 July 2008
The fact that the IRA makes no reference to the Panel’s conclusion in Japan –
Apples or to its thorough review of the scientific literature, is a clear indication
that the IRA did not give genuine consideration to the lack of scientific
evidence that mature symptomless apples provide a pathway for the
transmission of fire blight.1117
885.
In Australia’s view, an alleged failure by the IRA Team to refer to the panel’s conclusion
in Japan – Apples1118 does not amount to a failure to consider scientific evidence that mature
apples do not provide a pathway for the transmission of fire blight. The Final IRA Report does
not evaluate the findings of Japan – Apples, or its review of the scientific literature, because this
panel report and its findings are not scientific evidence. This does not mean that the IRA Team
did not consider all the scientific evidence available to it.
886.
New Zealand’s suggestion that a failure to take account of the findings in Japan – Apples
means that “the IRA did not give genuine consideration to the … scientific evidence [in relation
to whether] mature symptomless apples provide a pathway for the transmission of fire
blight”1119, is clearly incorrect. The IRA Team considered a wide range of scientific material
from many sources in its fire blight risk assessment, many of which were also considered by the
panel in the Japan – Apples dispute. Some of those references supported the conclusion that the
pathway was unlikely to be completed. Others supported a contrasting view. Both sets of
evidence were taken into account by the IRA Team.1120
887.
Australia submits that the IRA Team conducted a comprehensive and balanced review of
the scientific literature. Indeed, if it had omitted to do this and relied simply on the conclusions
of Japan – Apples as New Zealand suggests, Australia certainly could not claim to have taken
the available evidence into account. Accordingly, the IRA Team properly took into account the
available scientific evidence on fire blight, consistent with Article 5.2.
New Zealand’s first written submission, para. 4.414.
The Panel Report in Japan – Apples is referenced in the Final IRA Report.
1119
New Zealand’s first written submission, para. 4.414.
1120
For example, in considering whether E. amylovora would be present in or on apple fruit under
Importation step 2, the IRA Team assessed evidence which supported epiphytic infestation and endophytic infection,
and that evidence which did not. This is clearly demonstrated by the fact that the section of the Final IRA Report
addressing Importation step 2 is divided into four parts titled with headings describing the kind of evidence
considered. These are: “infestation of mature fruit”, “no infestation of mature fruit”, “infection of mature fruit” and
“no infection of mature fruit”. (Final IRA Report, Part B, p. 55.)
1117
1118
271
Australia – Apples (DS367)
ii.
888.
Australia’s First Written Submission of Australia
18 July 2008
European canker
New Zealand refers to the outbreak of European canker in Tasmania and asserts that:
The IRA considers this incident minimally at most and proceeds on the basis
of assumptions about interstate and international trade in apples from
Tasmania that are not based on fact. The IRA fails to take account of the
relevant fact that, despite significant interstate trade in Tasmanian apples,
transmission of the disease to the Australian mainland did not occur.1121
889.
It is simply untrue to suggest that the IRA Team considered the Tasmanian outbreak of
European canker “minimally at most”. On the contrary, the European canker chapter in the Final
IRA Report contains 16 separate references to this incident.1122 The IRA Team also considered a
substantive study by Ransom (1997) specifically dealing with the Tasmanian outbreak.1123
890.
The likely reasons for the limited spread of N. galligena during the Tasmanian outbreak
are explained in the Final IRA Report. First, Tasmania implemented a robust program to
eradicate the disease which was ultimately successful.1124 Secondly, in the Tasmanian strain of
the disease there were no ascospores, which are better suited to long distance dispersal than
conidia.1125 Thirdly, the local climatic conditions during the relevant time period in Spreyton,
Tasmania may have been unfavourable to that particular strain of the disease.1126 Fourthly,
chemicals being used to control apple scab may have had an impact.1127 Finally, as previously
mentioned, Australia considers that the Tasmanian outbreak was likely to have been a unique
strain of N. galligena that required another mating type for reproduction.
891.
The Final IRA Report acknowledges that during the Tasmanian outbreak of European
canker, Australia did not prohibit the movement of fruit out of the area. 1128 While there may
have been “significant interstate trade in Tasmanian apples”, as New Zealand asserts1129, during
the outbreak, this does not equate to a significant interstate trade in Spreyton apples. In fact, the
Final IRA Report suggests that it was unlikely there was significant movement of fruit out of
New Zealand’s first written submission, para. 4.415. (emphasis added)
See: Final IRA Report, Part B, pp. 117, 141, 143, 144, 146, 147, 148, 149, 154 & 155.
1123
Exhibit NZ-13: Ransom (1997). See Final IRA Report, Part B, p. 368.
1124
Final IRA Report, Part B, pp. 117, 143, 144, 146, 149 & 154.
1125
Final IRA Report, Part B, pp. 141 & 147.
1126
Final IRA Report, Part B, pp. 141, 144 & 147.
1127
Final IRA Report, Part B, p. 141.
1128
Final IRA Report, Part B, p. 155.
1129
New Zealand’s first written submission, para. 4.415.
1121
1122
272
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18 July 2008
Spreyton at the time. The IRA Team considered that the quarantine authorities at the time may
have concluded that the small volume of fruit that would be moved out of the Spreyton area did
not constitute an unacceptable risk.1130 This view is actually borne out by the unverified data
which New Zealand has collected on Spreyton apple production.1131 According to this data, each
year during the period 1970-1976 an average of 151 tonnes of Spreyton apples were shipped to
the mainland – that is less than 0.04% of annual production in Spreyton. It is also worth noting
that fruit infection was not reported during the Tasmanian outbreak.
892.
In light of the preceding discussion it is clear that the IRA Team took into account the
available scientific evidence in relation to the outbreak of European canker in Tasmania. New
Zealand has therefore failed to establish that the IRA Team did not take into account the
available scientific evidence.
3.
The IRA Team took into account relevant processes and production methods
893.
New Zealand alleges that the IRA Team “failed … to take into account relevant New
Zealand practices with respect to the export of apples, and has failed to take into account the
practices of its own packing industry. This failure affects Australia’s assessment of the risk of
entry, establishment and spread of fire blight, European canker and ALCM.”1132 Australia will
show that all such matters were taken into account by the IRA Team.
894.
In relation to fire blight, European canker and ALCM, New Zealand argues that the IRA
Team should not have assumed that “apple fruit from New Zealand will be repacked at rural
packing houses in close proximity to orchards”.1133 This argument rests on New Zealand’s
contention that “in line with commercial requirements, New Zealand increasingly exports apple
fruit … as ‘just-in-time’ consignments in ‘retail-ready’ packs.”1134
1130
Final IRA Report, Part B, p. 155. At present, 90% of the Tasmanian apple crop comes from the Huon
Valley, the remaining 10% coming from the Tamar Valley and Spreyton in the north. The current production in
Spreyton can be estimated as approximately 5-7% of the Tasmanian crop.
1131
New Zealand’s first written submission, Annex 5, Table 4, p. 249. Australia has been unable to verify
the accuracy of the data contained in Table 4 and would be grateful if New Zealand could provide copies of the
relevant production cards from Tasmanian Archives.
1132
New Zealand’s first written submission, para. 4.417.
1133
New Zealand’s first written submission, para. 4.418.
1134
New Zealand’s first written submission, para. 4.418. (emphasis added)
273
Australia – Apples (DS367)
895.
Australia’s First Written Submission of Australia
18 July 2008
As previously mentioned, any attempt by New Zealand to transform the product at issue
in this dispute into “retail-ready” “just-in-time” apple fruit should be rejected by the Panel. New
Zealand refused to limit its apple exports to “retail ready” during the IRA process. 1135 New
Zealand’s use of the word “increasingly” in the above quote is indicative of its continued
ambivalence towards the mode of trade.
896.
As explained above in relation to Australia’s arguments on ALCM under Article 5.1, the
requirements and demands of Australian importers and buyers will ultimately influence the type
of product exported from New Zealand.1136 One of Australia’s largest retailers of fresh fruit,
Coles, provides returnable plastic crates to suppliers for fruit to be packed and delivered to Coles
retail outlets for sale,1137 which Australia doubts will be shipped empty to New Zealand to permit
New Zealand exporters to pack “retail ready” for the Australian market.
897.
In respect of New Zealand’s argument that most of its exports would be “retail ready”
and therefore require little repacking in Australian orchard-based packing houses, Australia notes
that the IRA Team considered two possible scenarios in respect of ALCM, as follows:
One scenario was based on 0.1%-5% of imported apples being distributed to
orchard packing houses and the remainder (95%-99.9%) being distributed to
urban wholesalers. The other scenario was based on 70%-100% of imported
apples being distributed to orchard packing houses and the remainder (0-30%)
being distributed to urban wholesalers.1138
898.
In relation to fire blight, European canker and ALCM, New Zealand also claims that
Australia “failed to take into account Australian domestic packing house practices and
standards” on the basis of New Zealand’s argument that “[n]o country with a fruit fly problem
like that of Australia would permit packing houses to leave waste exposed to the elements.”1139
1135
See: Final IRA Report, Part B, pp. 9-10.
Exhibit AUS-63: United States Department of Agriculture Foreign Agricultural Service, “New Zealand
Fresh Deciduous Fruit Report 2007”, GAIN Report Number: NZ7033, 18 December 2007, p. 8.
1137
Exhibit AUS-62: Coles Myer’s returnable plastic crate initiative: Coles Group, National Packaging
Covenant
Annual
Report
2006/7,
p.
27
(website
http://www.packagingcovenant.org.au/documents/File/Coles_Group_AR_06_07_Public.pdf, accessed 9 July 2008);
Coles
Myer
Ltd,
Corporate
Social
Responsibility
Report
2005,
p.
16
(website
http://www.colesgroup.com.au/library/newsmedia/20051019_corporate_social_responsibility_report.pdf, accessed 9
July 2008).
1138
Final IRA Report, Part B, p. 172.
1139
New Zealand’s first written submission, paras. 4.419-4.420.
1136
274
Australia – Apples (DS367)
899.
Australia’s First Written Submission of Australia
18 July 2008
As explained above in relation to Australia’s arguments under Article 5.1, New Zealand
fails to acknowledge that practices to manage fruit fly are only mandated in fruit fly free areas
and are not implemented unless there is actually an outbreak of fruit fly in a particular area in
Australia.1140 When there is an outbreak, fruit fly management is targeted at the production
aspect and on uncovered fruit and waste in specified proximity zones to the outbreak through the
use of fruit fly specific sprays.1141 In any event, the bulk of relevant apple handling facilities in
Australia occur in apple production regions that are not those specifically intended as fruit fly
free areas, or are areas where fruit flies are not historically an issue for apple production. New
Zealand has failed to provide any evidence to suggest otherwise.
900.
New Zealand has therefore failed to establish that the IRA Team did not take into account
the relevant processes and production methods.
4.
The IRA Team took into account relevant inspection, sampling and testing methods
901.
New Zealand does not contest this issue in relation to either fire blight or European
canker. New Zealand claims in respect of ALCM that “Australia ignores the inspection that
would take place by AQIS officials on the entry of apples into Australia. The standard AQIS
protocol is a 600 unit inspection, which is applied to virtually all of the many hundreds of plant
products imported into Australia.”1142
902.
Presumably New Zealand is referring to its argument that the IRA Team failed to take
into account a 600-unit inspection by AQIS in its assessment of Importation step 8.1143 At
Importation step 8, the IRA Team evaluated the likelihood that any ALCM on imported New
Zealand fruit survives minimum border procedures in Australia.
As previously explained,
Importation step 8 only takes into account minimum on-arrival border procedures1144, rather than
any potential additional measures, such as a 600 fruit inspection by AQIS. The IRA Team was
assessing the unrestricted risk. The efficacy of a 600 unit AQIS inspection to address the risks
See: Exhibit AUS-93: Extract from AQIS Plant Programs Section (2008), Australia – New Zealand
Bilateral Quarantine Arrangement: Systems Operation Manual 7, February 2008, pp. 26-28.
1141
See, for example: Exhibit AUS-94: Standing Committee on Agriculture and Resource Management,
Code of Practice for Management of Queensland Fruit Fly, (Interstate Plant Health Working Group, Australia),
September 1996, Sections 3 & 4.
1142
New Zealand’s first written submission, para. 4.422.
1143
See: New Zealand’s first written submission, para. 4.346.
1144
Final IRA Report, Part B, page 23.
1140
275
Australia – Apples (DS367)
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18 July 2008
associated with ALCM was assessed by the IRA Team when it evaluated what measures could
be applied to mitigate the risks.1145
903.
New Zealand has therefore failed to establish that the IRA Team did not take into account
the relevant inspection, sampling and testing methods.
5.
The IRA Team took into account the prevalence of specific diseases or pests
904.
New Zealand does not contest this issue in relation to either fire blight or European
canker, and it should not be permitted to expand its claims at a later stage in the proceedings.
New Zealand claims that, “[i]n assessing the likelihood that apples will be infested with ALCM,
Australia failed to take into account the actual prevalence of viable ALCM pupae, rather than
just cocoons which are in many cases empty.”1146 New Zealand appears to be referring to the
IRA Team’s analysis at Importation step 2 for ALCM, at which it assessed the likelihood that
picked apples would be infested with viable ALCM.1147 New Zealand asserts that the IRA Team
reached its conclusions on Importation step 2 on the basis of a study by Tomkins et al. (1994)
only. As explained above, the IRA Team clearly took into account the Rogers et al. (2006)
paper identified by New Zealand.1148 New Zealand’s claim that that study “indicates that only
approximately 15% of cocoons contain viable pupae”1149 is erroneous, as previously explained.
The IRA Team clearly evaluated the evidence on viability of ALCM cocoons provided by
Tomkins et al. (1994), Rogers et al. (2006), Lowe (1993) and HortResearch (MAFNZ, 2005).1150
905.
New Zealand has therefore failed to establish that the IRA Team did not take into account
the prevalence of specific diseases or pests.
1145
See: Final IRA Report, Part B, pages 188-192.
New Zealand’s first written submission, para. 4.423.
1147
See: Final IRA Report, Part B, pages 159-160.
1148
New Zealand’s first written submission, para. 4.423.
1149
New Zealand’s first written submission, para. 4.423.
1150
See: Final IRA Report, Part B, pages 159-160.
1146
276
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18 July 2008
6.
The IRA Team took into account relevant ecological and environmental conditions
906.
New Zealand does not contest this issue in relation to either fire blight or ALCM, and
should not be permitted to expand its claims at a later stage in these proceedings. New Zealand
asserts, in relation to European canker, that the IRA Team:
… failed … to take into account relevant environmental conditions, by
ignoring climatic conditions. The climatic conditions Australia has ignored
have a bearing both on the likelihood of infection in New Zealand and on the
likelihood that European canker would establish and spread in Australia.1151
907.
Australia rejects New Zealand’s assertion in this regard. The European canker chapter in
the Final IRA Report contains four separate sections dedicated specifically to discussion of
relevant environmental conditions, including climate.1152
908.
Further, as previously indicated, Australia considers that New Zealand’s climate analysis
is too narrow.1153 Australia’s modelling demonstrates that the area of potential European canker
establishment and spread in Australia covers a much larger area than suggested by New Zealand
(Figures 1 & 2, Annex 2). In addition, contrary to what New Zealand suggests,1154 these climatic
conditions are present in the major pome fruit regions of Australia (Figure 3, Annex 2).
909.
Australia also does not accept that “no region in New Zealand has climatic conditions
suitable for fruit infections in summer”.1155 On the contrary, the Final IRA Report refers to
evidence of occasional N. galligena fruit rot in New Zealand due to wet conditions during
harvest in the summer.1156 In addition, Australia’s modelling (Annex 2) confirms the incidence
of European canker in New Zealand.
910.
In light of the preceding discussion it is clear that the IRA Team did take into account
relevant climatic conditions in relation to European canker. New Zealand has therefore failed to
establish that the IRA Team did not take into account the relevant ecological and environmental
conditions.
New Zealand’s first written submission, para. 4.424. See also paras. 4.425-4.426.
Final IRA Report, Part B, pp. 119, 137, 140, & 141.
1153
New Zealand first written submission, Annex 3, pp. 218-240.
1154
New Zealand first written submission, para. 4.425.
1155
New Zealand first written submission, para. 4.425.
1156
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook and Bailey, (1965); Exhibit NZ-34:
Braithwaite (1996); and Exhibit AUS-51: MAFNZ, 2005a: Final IRA Report, Part B, pp 121-123.
1151
1152
277
Australia – Apples (DS367)
7.
Australia’s First Written Submission of Australia
18 July 2008
Conclusion: New Zealand has failed to demonstrate that Australia has acted
inconsistently with Article 5.2
911.
Australia has demonstrated that the IRA Team took into account all the factors
challenged by New Zealand under Article 5.2.
New Zealand has failed to demonstrate
otherwise. Australia has accordingly acted consistently with its obligations under Article 5.2 of
the SPS Agreement.
278
Australia – Apples (DS367)
E.
Australia’s First Written Submission of Australia
18 July 2008
ALTERNATIVELY, AUSTRALIA’S MEASURES ARE NONETHELESS CONSISTENT
WITH ARTICLE 2.2
912.
Article 2.2 of the SPS Agreement requires that SPS measures must be based on scientific
principles (second requirement) and that SPS measures must not be maintained without
sufficient scientific evidence (third requirement), inter alia.1157
1.
New Zealand’s approach to Article 2.2 is confused and inconsistent
913.
In Australia’s view, New Zealand’s approach to Article 2.2 is confused and inconsistent.
914.
First, New Zealand does not substantively deal with Article 2.2 second requirement in its
analysis of Article 2.2 third requirement.
Instead, New Zealand treats Article 2.2 second
requirement differently and deals with it in a cursory fashion under its analysis of Article 5.1. 1158
This approach appears to be inconsistent with the panel’s view in EC – Biotech Products which
suggests that “[i]t is appropriate to analyse separately the first requirement [of Article 2.2], on
the one hand, and the second and third requirements [of Article 2.2], on the other hand.”1159
Presumably, the panel in EC – Biotech Products took this view because it considered that
whether SPS measures are based on scientific principles “may be useful in understanding the
extent of [the respondent’s] obligations under that Article”.1160
915.
Secondly, New Zealand addresses its arguments on Article 2.2 third requirement in
complete isolation from Article 5.1.1161 But then New Zealand subsequently baldly asserts in its
conclusion on Article 5.1 that because Australia’s measures are not based on a risk assessment,
the measures are also in breach of the third requirement of Article 2.2.1162 New Zealand’s
approach is inconsistent. On the one hand, New Zealand wants to deal with Article 2.2 in
isolation from Article 5.1. On the other hand, when it is convenient, New Zealand invokes the
close relationship between Article 2.2 and Article 5.1.
1157
See Panel Report, EC – Biotech Products, para. 7.47 (sub-para. 82 of preliminary ruling) and
paras. 7.1424 & 7.3392.
1158
New Zealand’s first written submission, paras. 4.6, 4.150 & 4.405.
1159
See Panel Report, EC – Biotech Products, para. 7.3392.
1160
Panel Report, Japan – Apples, para. 8.77.
1161
New Zealand’s first written submission, paras. 4.3-4.150.
1162
New Zealand’s first written submission, para. 4.405. New Zealand also makes a similar claim in
relation to Article 5.2 of the SPS Agreement: see New Zealand’s first written submission, para. 4.429.
279
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
2.
New Zealand has abandoned is claim in relation to Article 2.2 second requirement
916.
New Zealand devotes only two sentences in its entire first written submission in support
of its claim that Australia’s measures are inconsistent with the second requirement of Article
2.2.1163
917.
In Australia’s view, the lack of substantive argumentation by New Zealand under the
second requirement of Article 2.2 suggests that New Zealand has abandoned its claim.1164
Accordingly, the Panel should refrain from considering the matter.
918.
In any event, Australia has shown that its measures are based on scientific principles and
are therefore consistent with Article 2.2 second requirement. Scientific method is central to the
second requirement of Article 2.2. As demonstrated above, the Final IRA Report was prepared
by qualified and respected scientific experts, the IRA Team, on the basis of scientific method.
Given that the measures at issue in this dispute are derived from the Final IRA Report, they are
clearly based on scientific principles.
New Zealand has failed to establish otherwise.
Accordingly, there is no basis for a finding that Australia’s measures are inconsistent with the
second requirement.
3.
A rational and objective relationship between the SPS measure and the scientific
evidence is required
919.
Australia’s primary submission is that, given the special nature of the legal relationship
between Article 2.2 third requirement and Article 5.1, consistency with Article 5.1 establishes
consistency with Article 2.2 third requirement. If the Panel does not accept Australia’s primary
submission, Australia submits that New Zealand has nevertheless failed to establish that
Australia’s measures are inconsistent with Article 2.2 third requirement.
920.
Australia considers that the Panel should apply the following test set out by the Appellate
Body in Japan – Agricultural Products II in relation to Article 2.2 third requirement:
The ordinary meaning of “sufficient” is “of a quantity, extent, or scope
adequate to a certain purpose or object”. From this, we can conclude that
“sufficiency” is a relational concept. “Sufficiency” requires the existence of a
New Zealand’s first written submission, paras. 4.405, 4.429.
The Appellate Body has recognised that complainants may abandon certain claims during the course of
proceedings: see, Appellate Body Report, Japan – Apples, para. 136.
1163
1164
280
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
sufficient or adequate relationship between two elements, in casu, between the
SPS measure and the scientific evidence.1165
921.
Accordingly, the question for the Panel is whether there is a sufficient or adequate
relationship between Australia’s phytosanitary measures and the scientific evidence.
The
Appellate Body further reasoned that:
[T]he obligation in Article 2.2 that an SPS measure not be maintained without
sufficient scientific evidence requires that there be a rational or objective
relationship between the SPS measure and the scientific evidence.1166
922.
In undertaking this assessment, the Panel must be constantly mindful of the following
points. First, consistency with Article 2.2 third requirement “is to be determined on a case-bycase basis and will depend upon the particular circumstances of the case, including the
characteristics of the measure at issue and the quality and quantity of the scientific evidence”.1167
Second, the term “scientific evidence” has a broad meaning and includes both “direct”” and
“indirect” evidence.1168 Third, “responsible and representative governments may act in good
faith on the basis of what, at a given time, may be a divergent opinion coming from qualified and
respected sources.”1169 Fourth, the consequences of the entry, establishment and spread of a
particular pest or disease within the territory of the importing Member may be serious and
irreversible, and in such circumstances “responsible, representative governments commonly act
from a perspective of prudence and precaution”.1170 Fifth, there may be a range of possible SPS
measures open to an importing Member which will be consistent with the SPS Agreement.1171
i.
923.
New Zealand should not apply a scientific justification “test”
In Australia’s view, New Zealand erroneously applies a scientific justification “test” in
arguing its case under Article 2.2 third requirement, the assertion being that the measures at issue
are not “justified” by scientific evidence.1172 Article 2.2 imposes no such test. New Zealand
1165
Appellate Body Report, Japan – Agricultural Products II, para. 73 (footnotes omitted; emphasis
added).
Appellate Body Report, Japan – Agricultural Products II, para. 84. (emphasis added)
Appellate Body Report, Japan – Agricultural Products II, para. 84.
1168
Panel Report, Japan – Apples, para. 8.98.
1169
Appellate Body Report, Japan – Agricultural Products II, para. 77. See also Panel Report, Japan –
Apples (Article 21.5 – US), para. 8.146.
1170
Panel Report, Japan – Apples, para. 8.105.
1171
Panel Report, EC – Biotech Products, para. 7.1525.
1172
New Zealand’s first written submission, paras. 4.43, 4.44, 4.47, 4.142, 4.123, 4.146, 4.147, 4.148, &
4.149.
1166
1167
281
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
would have the Panel believe that there is only one “correct” view of the scientific evidence
available, illustrated by its claim that, “[Australia’s] measures have been imposed in the absence
of scientific evidence or in the face of scientific evidence to the contrary”.1173 New Zealand’s
scientific justification “test” ignores the fact that the Appellate Body has explicitly recognised
that Members may rely on divergent scientific opinion.1174
ii.
924.
The appropriate burden of proof under Article 2.2 third requirement
In Australia’s view, the negative (rather than positive) formulation of the obligation (i.e.
not to maintain SPS measures without sufficient scientific evidence) in the third requirement of
Article 2.2 has implications for the burden of proof. It requires the complainant to show the
insufficiency of the scientific evidence relied upon by the respondent in relation to a particular
measure at issue.
925.
Accordingly, the burden is on New Zealand to show that the scientific evidence relied
upon by Australia, as evaluated by the IRA Team in the risk assessment, is insufficient for there
to be a rational and objective relationship with the measures at issue. It is not enough for New
Zealand to simply assert its own narrative as to the scientific evidence – New Zealand must
actually show that the IRA Team’s evaluation of the scientific evidence was not objective and
credible. The next section demonstrates that New Zealand has failed to do so.
4.
Australia’s measures for fire blight are not maintained without sufficient scientific
evidence
926.
New Zealand makes the following claim in relation to all eight fire blight measures:
As the Panel and Appellate Body have concluded in Japan – Apples, there is
no such evidence supporting measures such as those imposed by Australia in
relation to fire blight. Even if Australia’s assumptions about the presence and
spread of fire blight bacteria on mature apples during picking, processing and
transport were supported by science, there is no scientific support for the
contention that such bacteria will transfer to susceptible hosts and infection
will occur.
New Zealand’s first written submission, para. 4.6. (emphasis added)
Appellate Body Report, Japan – Agricultural Products II, para. 77; see, also: Panel Report, Japan –
Apples (Article 21.5 – US), para. 8.146.
1173
1174
282
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Since mature, symptomless apple fruit do not provide a pathway for fire blight
to be transmitted to Australia, none of the following measures imposed by
Australia has a “rational or objective relationship” with scientific evidence.1175
927.
The compliance panel in Japan – Apples (Article 21.5 – US) relied substantially on the
original panel’s finding that apples are unlikely to provide a pathway for fire blight to conclude
that Japan’s revised measures were inconsistent with Article 2.2. Australia has already provided
cogent and extensive reasons why the Panel should not rely on the findings in the Japan – Apples
dispute. Accordingly, the findings in Japan – Apples (Article 21.5 – US) equally cannot be
relied up. Once again, New Zealand attempts to escape from establishing a proper basis for its
claim by outsourcing its entire argument to the Japan – Apples (Article 21.5 – US) findings that
were neither a risk assessment nor scientific evidence.
928.
New Zealand’s almost exclusive reliance on this panel report – and its consequent failure
to adduce evidence relevance to this case – should be sufficient for the Panel to find that New
Zealand has not met its burden of proof. In case the Panel disagrees with this view, Australia
will show that its measures for fire blight are not maintained without sufficient scientific
evidence.
i.
Australia’s principal risk management measures are supported by
sufficient scientific evidence
929.
Australia recalls that its principal risk management measures for fire blight were adopted
as part of a systems approach to achieve Australia’s ALOP. This decision was based on the
detailed analysis of risk management measures in the Final IRA Report 1176 which New Zealand
fails to acknowledge. Australia therefore submits that individually and taken together, the
measures are supported by sound scientific evidence.
930.
Australia recalls that the principal risk reduction measures for fire blight are:
New Zealand apples to be sourced from orchards free from symptoms of fire
blight, requiring orchards to be visually inspected (once annually) at an
intensity that would, at a 95% confidence level, detect visible symptoms if
shown by 1% of the trees, with the inspection to take place between 4 to 7
New Zealand’s first written submission, paras. 4.31-4.32. New Zealand’s reference to “Japan –
Apples” in this quoted passage is taken by Australia as a reference to the compliance panel’s decision in Japan –
Apples (Article 21.5 – US) as it is the latter decision that New Zealand consistently relies on in the substance of its
claims which follow (eg. paras. 4.34, 4.36, 4.42, 4.44, 4.49, 4.50).
1176
Final IRA Report, Part B, pp. 105-115.
1175
283
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
weeks after flowering (when conditions for fire blight disease development are
likely to be optimal); the detection of any visible symptoms of fire blight will
result in the suspension of the orchard/block for the season; and
the use of disinfection treatment (for example complete immersion in a water
solution containing a minimum of 100ppm available chlorine for a minimum
of one minute) in the packing house to remove existing surface contamination
with fire blight bacteria and prevent further contamination.1177
931.
New Zealand argues that there is no scientific evidence demonstrating that mature apples,
even from severely blighted orchards, contain E. amylovora in quantities of epidemiological
significance to the establishment and spread of fire blight. On this basis alone, it argues that the
principal risk reduction measures are not supported by sufficient scientific evidence.1178
932.
This rehearses the same arguments New Zealand made under Importation steps 1, 2 and
4, and the exposure analysis. Australia has already rebutted these claims above and submits that
the Panel should consider those arguments applicable here.
933.
Australia has shown that the IRA Team assessed a substantial body of evidence and
concluded that there is no accepted minimum number of bacteria needed to initiate infection.
Consequently, it concluded that apples with any number of E. amylovora increase the potential
risk of fire blight transmission. The IRA Team considered evidence that reported reduced
infestation of apples with E. amylovora when sourced from orchards with few or no visible
symptoms.1179 As New Zealand has referred to the findings of these very same studies, it
presumably accepts their veracity.
934.
On the basis of the scientific evidence available to it, the IRA Team concluded that
“freedom from visible symptoms” provided a firm basis for risk reduction.1180 The IRA Team
acknowledged that it would be extremely difficult to confirm absolute freedom from symptoms
using visual inspection of orchards. Therefore they concluded that:
… a practical inspection regime should be specified as free from visual
symptoms at an inspection intensity that would, at a 95% confidence level,
detect visual symptoms if shown by 1% of the trees. This inspection should
1177
See: Final IRA Report, Part A, p. 15; Part B, p. 318.
New Zealand’s first written submission, paras. 4.33, 4.35, 4.41 & 4.43.
1179
Exhibit NZ-22: Roberts et al. (1998); Exhibit NZ-53: Clark et al. (1993). Exhibit AUS-2: Final IRA
Report, Part B, pp. 106-107.
1180
Exhibit AUS-2: Final IRA Report, Part B, p. 106.
1178
284
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18 July 2008
take place between 4 to 7 weeks after flowering when conditions for fire blight
disease development are likely to be optimal.1181
935.
The IRA Team also considered disinfection as an alternative risk reduction measure.
There was substantial evidence demonstrating that chlorine has biocidal properties. 1182 The IRA
Team recognised that chlorine has poor penetrating power and loses effectiveness where there
are high organic matter loads (such as in apple floatation tanks). However, evidence also
demonstrated that 10 to 100-fold reductions in the levels of bacterial could be expected if pH
levels were correctly maintained.
Accordingly, the IRA Team concluded that a chlorine
treatment could reduce the risk of E. amylovora being present on apples if chlorine was added to
floatation tanks and maintained at 100 ppm.1183
936.
When the impact of each of these alternative measures on the unrestricted risk was tested
individually, the IRA Team found that they were insufficient on their own to reduce the risk to
Australia’s ALOP.1184 However, when the measures were taken together as a systems approach,
the IRA Team demonstrated that their combined effect was sufficient to reduce the level of risk
to Australia’s ALOP.1185
937.
New Zealand does not make any claims about analysis of these measures, the
calculations undertaken by the IRA Team, or the effectiveness of the measures as a systems
approach. Accordingly, Australia submits that New Zealand has failed to establish that the
principal risk reduction measures, either individually or taken as whole, are not supported by
sufficient scientific evidence.
938.
New Zealand argues “the requirement that an orchard/block be suspended for the season
on the basis of detection of any visual symptoms of fire blight”, “appears to be consequent on the
inspection requirement”.1186 Since it considers that the inspection requirement lacks scientific
support, it claims that block suspension if symptoms are detected “equally lacks scientific
1181
Final IRA Report, Part B, p. 106.
Dychdala, G.R. (1991) Chlorine and chlorine compounds. In: Block, S.S. (Ed) Disinfection,
sterilization and preservation. Lea & Febiger, Philadelphia, London. pp 131-151. The IRA Team also noted that
chlorine was already used in 37% of New Zealand packing houses: Final IRA Report, Part B, p. 107.
1183
Final IRA Report, Part B, p. 108.
1184
Final IRA Report, Part B, Table 24, p. 107.
1185
Final IRA Report, Part B, Table 27, p. 111.
1186
New Zealand’s first written submission, para. 4.40.
1182
285
Australia – Apples (DS367)
support”.1187
Australia’s First Written Submission of Australia
18 July 2008
Australia has demonstrated that the principal risk reduction requirements are
supported by sufficient scientific evidence. New Zealand has adduced no evidence to suggest
that the suspension requirement is not a valid measure for ensuring compliance with the principal
risk reduction requirement of freedom from fire blight symptoms. Therefore, there is no basis
for finding the suspension requirements are not supported by sufficient scientific evidence.
939.
New Zealand also challenges:
The requirement that an orchard/block inspection methodology be developed
and approved that addresses issues such as visibility of symptoms in the tops
of trees, the inspection time needed and the number of trees to be inspected to
meet the efficacy level, and training and certification of inspectors.
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of fire
blight.
The requirement that all grading and packing equipment that comes in direct
contact with apples be cleaned and disinfected (using an approved disinfectant)
immediately before each Australian packing run.
The requirement that packing houses registered for export of apples process
only fruit sourced from registered orchards.1188
940.
Australia explained previously that these four requirements challenged by New Zealand
are ancillary measures that support, verify and operationalise the principal risk reduction
measures. They do not “operate in some concrete way in [their] own right” 1189 and therefore
cannot individually give rise to a violation of WTO obligations. Accordingly, their consistency
with Article 2.2 depends on whether the principal risk reduction measures are consistent with
Article 2.2. Australia submits that since New Zealand has failed to show that the principal risk
reduction requirements above are not supported by sufficient scientific evidence, the Panel
should also find the ancillary measures to be scientifically supported.
New Zealand’s first written submission, para. 4.40.
New Zealand’s first written submission, para. 3.83 (original formatting omitted); New Zealand’s panel
request, pp. 1 & 2.
1189
Panel Report, US – Export Restraints, para. 8.85.
1187
1188
286
Australia – Apples (DS367)
5.
Australia’s First Written Submission of Australia
18 July 2008
Australia’s measures for European canker are not maintained without sufficient
scientific evidence
i.
941.
New Zealand’s claim
The crux of New Zealand’s complaint in relation to the measures for European canker is
that:
All of the Australian measures … are based on the contention that mature,
symptomless apple fruit provide a pathway for transmitting European canker.
However, as demonstrated above, there is no scientific evidence that such a
pathway exists.
…[accordingly] there can be no “rational or objective relationship” between
the measures that Australia has imposed for mature apple fruit from New
Zealand in respect of European canker, and the scientific evidence. Hence,
Australia’s measures are maintained without “sufficient scientific evidence”
and are inconsistent with Australia’s obligations under Article 2.2.1190
942.
New Zealand’s allegation that there is no scientific evidence that “mature, symptomless
apple fruit” are a pathway for transmission of European canker is inconsistent with the explicit
statement to the contrary by the Chief Plants Officer of the New Zealand Ministry of
Agriculture.1191 According to the Chief Plants Officer, “apple fruit are a potential pathway for
the introduction of European canker, as the fruit can develop latent or storage rots.”1192
943.
The Final IRA Report contains a comprehensive analysis of the risk of N. galligena being
introduced intro Australia through the importation of New Zealand apples.1193 The Final IRA
Report also cites several studies which show that fruit rot caused by N. galligena does
occasionally occur in New Zealand.1194 On the basis of this analysis the IRA Team concluded
that the unrestricted risk for N. galligena exceeds Australia’s ALOP and therefore risk
management measures were required.1195
1190
New Zealand’s first written submission, paras. 4.96-4.97. (emphasis added) See also: paras. 4.98, 4.99,
4.100 & 4.104.
1191
Exhibit AUS-54: Ivess (1996).
1192
Exhibit AUS-54: Ivess (1996), p. 2.
1193
Final IRA Report, pp. 117-150.
1194
Exhibit AUS-52: Atkinson (1971); Exhibit AUS-53: Brook & Bailey (1965); Exhibit NZ-34:
Braithwaite (1996); Exhibit AUS-51: MAFNZ (2005a); Final IRA Report, Part B, pp. 121-123.
1195
Final IRA Report, p. 150.
287
Australia – Apples (DS367)
944.
Australia’s First Written Submission of Australia
18 July 2008
Australia has already demonstrated above that the IRA Team rigorously evaluated risk
and applied its expert judgment to arrive at an objective and credible assessment for European
canker. Further, New Zealand has failed to demonstrate any flaws in the Final IRA Report.
ii.
945.
The measures at issue
The risk management measures for European canker were adopted on the basis of a
detailed analysis of risk management meaures in the Final IRA Report.1196 Australia’s principal
risk management measure for European canker is as follows:
… to allow export only from pest free places of production. Pest freedom
would require a winter inspection of orchards before pruning of trees to
confirm freedom.1197
946.
The IRA Team determined that “the use of areas free from disease symptoms for
sourcing export apples would be an effective risk management measure for N. galligena.”1198
The validity of such a risk mitigation measure is recognised by ISPM No. 10. Table 39 in the
Final IRA Report clearly shows that the effect of requiring pest free places of production is to
reduce unrestricted risk from “low” to “very low” and thereby achieve Australia’s ALOP. 1199
947.
The IRA Team also considered that, in order to verify orchard freedom from European
canker, it would be necessary to “conduct[] growing season inspections for European canker
symptoms… All trees in the export orchard would be visually inspected annually in winter, after
leaf fall and before winter pruning.”1200 More precisely, the IRA Team recommended that:
All trees in the export orchard would be inspected annually in winter, after leaf
fall and before winter pruning. In areas where climatic conditions are less
favourable for disease establishment and spread …, orchard freedom from
European canker would be assessed by walking down every row and visually
examining all trees on both sides of each row for symptoms. … In areas where
environmental conditions are more conducive to disease establishment and
spread … the use of ladders to inspect tree limbs, combined with the inter-row
inspections would be necessary.1201
1196
Final IRA Report, pp. 150-155.
See: Final IRA Report, Part A, p. 15; Final IRA Report, Part B, pp. 153-155, 316.
1198
Final IRA Report, p. 153.
1199
Final IRA Report, p. 153.
1200
Final IRA Report, Part B, p. 153.
1201
Final IRA Report, Part B, pp. 153-154.
1197
288
Australia – Apples (DS367)
948.
Australia’s First Written Submission of Australia
18 July 2008
The IRA Team noted that “the proposed winter inspection approach ha[d] proven to be
highly effective during the eradication efforts in Spreyton, Tasmania.”1202 The Final IRA Report
explains that, “[t]he purpose of winter inspection before pruning is to detect if the disease has
established in the orchard during the previous spring, summer and autumn. If it has not, there
will be no inoculum for infection in the next growing season.”1203
949.
The IRA Team also recommended that:
All new planting stock must be intensively examined, and appropriate cultural
practices and fungicide sprays used to minimise the likelihood of canker
infections.1204
It explicitly noted that “infected nursery stock presents a pathway for the establishment and
spread of European canker in places of production”1205 within New Zealand, citing the following
evidence in support of this view:
Recent detections in Nelson (Murdoch, 2002) and previous reports in Hawke’s
Bay (Wilton, 2002b) are considered to have occurred as a result of this
pathway. Studies in the United Kingdom have confirmed that infection
entering orchards through nursery stock can remain symptomless for up to four
years (Lovelidge, 2003; McCraken et al., 2003b).1206
On this basis, the IRA Team determined that “[a]ll new planting stock must be intensively
examined”.1207
950.
Australia has previously explained that it does not impose the following requirement:
The requirement that an orchard/block be suspended for the season on the basis
that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of
European canker.
Accordingly, there can be no findings in relation to such a measure.
951.
The IRA Team recommended that:
1202
Final IRA Report, Part B, p. 154. See also Exhibit NZ-13: Ransom, 1997.
Final IRA Report, Part B, p. 154.
1204
Final IRA Report, Part B, p. 154.
1205
Final IRA Report, Part B, p. 154.
1206
Final IRA Report, Part B, p. 152. Exhibit AUS-105: Murdoch, H. (2002) "Apple disease spreads", The
Nelson Mail, 27 August 2002; Exhibit AUS-106: Wilton, J. (2002b) "Recognising European canker symptoms"
Fencepost.com; Exhibit AUS-107: Lovelidge, B. (2003) "Closing in on canker" Grower 139 (3), pp22-23; Exhibit
AUS-77: McCraken et al, 2003.
1207
Final IRA Report, Part B, p. 154.
1203
289
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18 July 2008
Detection of European canker would result in suspension of exports in that
orchard/block for the coming season. Reinstatement would require eradication
of the disease, confirmed by inspection.1208
The IRA Team considered that if European canker were detected during an inspection “the
orchard would be ineligible to export fruit during the following season. To be eligible for reregistration, cankers must be removed and follow-up fungicides applied, followed by
reinspection of the orchard for canker symptoms the following season.”1209 This is an ancillary
requirement recommended to enforce the integrity of orchard freedom, the principal risk
mitigation measure.
iii.
952.
Summary
In light of the preceding analysis, as well as relevant rebuttal points made in the context
of Article 5.1, it is clear that New Zealand has failed to establish that Australia’s measures for
European canker are maintained without sufficient scientific evidence.
6.
Australia’s measures for apple leafcurling midge are not maintained without
sufficient scientific evidence
953.
New Zealand challenges the basis for Australia’s measures in respect of ALCM under
Article 2.2, as follows:
The low number of viable cocoons on New Zealand apples combined with the
biology of the ALCM, both factors which Australia has ignored, render highly
improbable the sequence of events on which Australia relies to support its
measures. There is no scientific evidence demonstrating that such a sequence
of events has ever occurred or could occur. Thus, the measures maintained by
Australia are without sufficient scientific evidence.1210
954.
Australia has provided for two risk management options for ALCM:
inspection of a 3000-apple random sample of all export lots in New Zealand;
application of a suitable treatment (e.g. fumigation) or rejection of any relevant
lots will be required where ALCM is found; or
1208
Final IRA Report, Part B, p. 316.
Final IRA Report, Part B, p. 154.
1210
New Zealand’s first written submission, para. 4.134.
1209
290
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18 July 2008
treatment of all lots with a suitable treatment (e.g. fumigation) for ALCM,
together with a standard inspection of 600-units per lot.1211
955.
Australia has shown above (under Article 5.1) that New Zealand’s claims as to the IRA
Team’s evaluation the scientific evidence available in relation to ALCM are unsubstantiated.
New Zealand has failed to establish that the IRA Team ignored any scientific evidence or other
relevant material in respect of its assessment of the risks associated with ALCM. Nor has New
Zealand established any flaws in the reasoning of or conclusions drawn by the IRA Team. Many
of New Zealand’s arguments are unsupported by any evidence, and its claims generally are
undermined by its failure to adequately comprehend the biology of ALCM, the scientific
evidence available, the methodology employed by the IRA Team to assess the risk, and
Australia’s particular circumstances.
956.
New Zealand claims that “[a] 600 unit sample on its own is more than sufficient to meet
the risk, and is not itself objectionable since it is commonly undertaken for a range of quarantine
pests.”1212 However, the IRA Team assessed the efficacy of a 600-unit inspection and found that
it would not achieve Australia’s ALOP without further measures (that is, mandatory treatment).
The IRA Team found that either a 3000-unit inspection alone, or alternatively a 600-unit
inspection plus mandatory treatment, would achieve Australia’s ALOP.1213
957.
As New Zealand has failed to establish that the Panel should not have reasonable
confidence in the IRA Team’s evaluation of the scientific evidence and consequent assessment
of the level of risk, there can be no basis for the Panel to find that the measures assessed
necessary by the IRA Team and by Australia, in order to achieve Australia’s ALOP, are
maintained without sufficient scientific evidence.
7.
Australia’s general measures are not maintained without sufficient scientific
evidence
958.
New Zealand claims that:
Since mature, symptomless apple fruit are not a pathway for fire blight or
European canker to be transmitted to Australia, and since there is no scientific
1211
New Zealand has acknowledged that an inspection of 600-units per lot is a standard quarantine
requirement to which they do not object: “A 600 unit sample … is not itself objectionable since it is commonly
undertaken for a range of quarantine pests.” (New Zealand’s first written submission, para. 4.138.)
1212
New Zealand’s first written submission, para. 4.138.
1213
See: Final IRA Report, Part B, pp. 188-192.
291
Australia – Apples (DS367)
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18 July 2008
evidence that entry, establishment and spread of ALCM could occur at the
levels of infestation reported on New Zealand apples, there is also insufficient
scientific evidence for Australia to maintain its additional measures applicable
to all three pests.1214
959.
Australia disagrees. These ancillary requirements imposed by Australia seek to support,
verify and operationalise the principal measures adopted by Australia for the reduction of risks
associated with specific pests to achieve Australia’s ALOP. Australia has demonstrated that its
principal risk reduction requirements are supported by sufficient scientific evidence (both
directly above and under Article 5.1). New Zealand has adduced no evidence to suggest that the
ancillary requirements are not valid requirements for ensuring verification and support of the
principal measures. Therefore, there is no basis for finding the ancillary requirements are not
supported by sufficient scientific evidence.
960.
New Zealand challenges:
The requirement that Australian Quarantine and Inspection Service [AQIS]
officers be involved in orchard inspections for European canker and fire blight,
in direct verification of packing house procedures, and in fruit inspection and
treatment.
The requirement that packing houses provide details of the layout of
premises.1215
961.
Australia has previously clarified the nature of its requirements. Australia will now
explain the basis for imposing such requirements.
962.
Australia requires AQIS officers to be involved in a standard pre-clearance arrangement
for New Zealand apples1216 because New Zealand apples will otherwise be untested during initial
trade. It is common practice for AQIS to conduct pre-clearance processes and on-site
verification that the required packing house, treatment and inspection procedures are being
followed by relevant producers. Therefore, AQIS involvement in New Zealand orchard and fruit
inspections and verification of packing house procedures, as part of the pre-clearance process,
will help to ensure that non-conforming consignments of New Zealand apples will not enter
New Zealand’s first written submission, para. 4.141.
New Zealand’s first written submission, para. 3.83.
1216
Final IRA Report, Part B, p. 314.
1214
1215
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18 July 2008
Australia. Other countries such as the United States and Japan have similar arrangements that
are either mandated or voluntary.1217
963.
Australia requires packing houses to provide a basic map of the layout of their premises
in order to support the verification of packing house procedures by AQIS officers. As previously
explained, provision of such a map in advance will enable AQIS to identify areas of potential
risk in particular packing houses.
964.
New Zealand also challenges:
The requirement that New Zealand ensure that all orchards registered for
export to Australia operate under standard commercial practices.
965.
The basis for Australia’s requirement that “all orchards registered for export to Australia
are operating under standard commercial practices”1218 is that an underlying assumption of the
IRA Team during the IRA process was that all orchards that would produce apples for export to
Australia would operate under such practices, as advised by Biosecurity New Zealand. 1219
Therefore, by asking that the IRA Team to take into account that commercial growers would
operate under standard commercial practices, New Zealand effectively limited the scope of the
IRA Team’s analysis as to the nature of the product that would be exported.
966.
In order to ensure that the nature of the product exported will be as assumed by the IRA
Team, Australia requires MAFNZ to verify that New Zealand growers continue to operate under
standard commercial practices. For if all growers do not operate under standard commercial
practices, the underlying premise for the IRA Team’s assessment of risk would be invalid.
967.
New Zealand has not adduced any evidence in support of its claim that “New Zealand
apples are processed according to standard commercial practice”, 1220 or why Australia or the
1217
See, for example: New Zealand apples and pears exported to the United States (Biosecurity New
Zealand, Importing Countries Phytosanitary Requirements: United States of America (24 November 1999), pages
40 & 42: http://www.biosecurity.govt.nz/files/regs/stds/icprs/united-states-of-america.pdf); cut-flowers to Japan
(http://www.pps.go.jp/english/faq/import/seeds.html); a list of countries for which the United States Department of
Agriculture (USDA) Animal & Plant Health Inspection Service (APHIS) conducts commodity pre-clearance
programs and the commodity (ies) involved at:
http://www.aphis.usda.gov/import_export/plants/plant_imports/downloads/preclearance_chart.pdf.
1218
Final IRA Report, Part B, p. 315.
1219
See: Exhibit AUS-51: MAFNZ (2005a), Correspondence sent from MAFNZ to Biosecurity Australia,
16 May 2005.
1220
New Zealand’s first written submission, para. 4.146.
293
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Panel should feel confident that all orchards registered for export will continue to operate under
standard commercial practices.
968.
New Zealand also claims that “Australia does not, to New Zealand’s knowledge, impose
such a requirement with regard to any other plant product imported into Australia.” 1221 This is
incorrect. Australia requires the operation of standard commercial practices in relation to fruit
imports from a number of other countries, for example: table grapes from Chile1222; longans and
lychees from China and Thailand1223; and mangoes from India (draft recommended measures
only).1224
969.
In light of the preceding discussion, it is clear that New Zealand has failed to establish
that Australia’s general measures are maintained without sufficient scientific evidence.
8.
Conclusion: New Zealand has failed to demonstrate that Australia’s measures are
inconsistent with Article 2.2
970.
Australia submits that New Zealand has failed to establish that Australia’s measures are
maintained without sufficient scientific evidence. In any event, Australia’s measures are based
on the IRA Team’s objective and credible analysis of the available scientific evidence and are
therefore consistent with Article 2.2 third requirement.
New Zealand’s first written submission, para. 4.145.
1222 See: Biosecurity Australia, Final Report: Import Risk Analysis for Table Grapes from Chile
(September 2005), page 11 (executive summary), available from:
http://www.daff.gov.au/__data/assets/word_doc/0016/11581/table_grapes_chile_final_IRA.doc.
1223
See: Biosecurity Australia, Final Import Risk Analysis Report: Longan and lychee fruit from the
People’s Republic of China and Thailand (February 2004), Part A, pages 40, 47, 101, 107, 135 & 136:
http://www.daff.gov.au/__data/assets/pdf_file/0014/164003/ll_final_a.pdf
1224
According to the Provisional Final Import Risk Analysis Report for Fresh Mango Fruit from India:
“The existing commercial production practice of a post-harvest fungicidal dip, as advised by India to support its
market access application, is an underlying requirement for export to Australia.” Biosecurity Australia, Provisional
Final Import Risk Analysis Report for Fresh Mango Fruit from India (May 2008), page 7:
http://www.daff.gov.au/__data/assets/pdf_file/0004/672403/Final_IRA_-_Mangoes_from_India.pdf
1221
294
Australia – Apples (DS367)
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18 July 2008
F.
AUSTRALIA’S MEASURES ARE CONSISTENT WITH ARTICLE 5.5
1.
Australia has had limited time to prepare its defence
971.
New Zealand argues that “nashi pears imported from Japan to Australia [is] an
illustration of a situation in which Australia has a level of protection that shows arbitrary and
unjustified distinctions in treatment resulting in discrimination and a disguised restriction on
trade.”1225
972.
Australia applies its ALOP consistently, including with respect to New Zealand apples
and Japanese nashi pears. Australia will show that there are differences in the risk associated
with the importation of New Zealand apples when compared with Japanese nashi pears, and that
the measures required to meet Australia’s ALOP therefore differ.
973.
Australia notes that New Zealand’s first written submission was the first occasion on
which Australia was made aware of the basis for New Zealand’s claim under Article 5.5. This
factor has prejudiced the preparation of Australia’s defence.
2.
New Zealand must satisfy the three distinct elements of Article 5.5
974.
Article 5.5 commences by setting out its objective to “achieve consistency in the
application of the concept of appropriate level of sanitary or phytosanitary protection” (ALOP).
This objective itself does not impose any legal obligation on Members. 1226 The Appellate Body
recognised in this regard:
… that the goal set is not absolute or perfect consistency, since governments
establish their appropriate levels of protection frequently on an ad hoc basis
and over time, as different risks present themselves at different times. It is only
arbitrary or unjustifiable inconsistencies that are to be avoided.1227
975.
In order to make a finding that a Member has acted inconsistently with Article 5.5, the
Appellate Body recognised that three elements need to be present:

the Member concerned adopts different appropriate levels of sanitary protection
in several “different situations”;
New Zealand’s first written submission, para. 4.435.
Appellate Body Report, EC – Hormones, para. 213.
1227
Appellate Body Report, EC – Hormones, para. 213.
1225
1226
295
Australia – Apples (DS367)

Australia’s First Written Submission of Australia
18 July 2008
those levels of protection exhibit differences which are “arbitrary or
unjustifiable”; and

the measure embodying those differences results in “discrimination or a disguised
restriction on international trade”.1228
976.
These elements are cumulative. As such, New Zealand is required to show that all three
elements are present if it is to establish its claim in relation to Article 5.5.
3.
Australia applies a consistent level of protection
977.
The first element of the first sentence of Article 5.5 requires a complainant to establish
that the respondent Member applies distinctions in the “levels” of its appropriate level of sanitary
or phytosanitary protection in different situations.
(a)
Australia’s ALOP is consistent with respect to New Zealand apples and
Japanese nashi pears
978.
Australia submits that a panel’s assessment of a Member’s consistency with its obligation
under Article 5.5 is facilitated where a Member has explicitly stated its ALOP with precision, as
Australia has done. Australia notes that few other Members have provided explicit transparent
statements of ALOP – for example, there is no explicit expression of New Zealand’s ALOP
publicly available. Australia’s ALOP is expressed as providing a high level of sanitary and
phytosanitary protection, aimed at reducing risk to a very low level, but not zero.1229 This ALOP
applies equally to the importation of apples from New Zealand1230 and nashi pears from
Japan.1231
Appellate Body Report, Australia – Salmon, para. 140.
Exhibit AUS-10: Commonwealth of Australia 2003, Import Risk Analysis Handbook 2003, p.5;
Commonwealth of Australia 2003, Import Risk Analysis Handbook 2007, p.8.
1230
In relation to New Zealand apples, the Final IRA Report (Part B) states that Australia’s ALOP is
“aimed at reducing risk to a very low level, but not to zero” (p.4), and that the recommended quarantine conditions
for New Zealand apples ensure “that Australia’s ALOP would be met and are commensurate with the identified
risks” (p.313).
1231
Biosecurity Australia conducted a review of the import conditions applying to nashi pears from Japan
in 2003. After having revised the relevant import conditions, Biosecurity Australia concluded that the revised
measures would “effectively achieve Australia’s appropriate level of protection.” Australia’s stated ALOP at the
time of the review was “expressed as providing a high level of sanitary or phytosanitary protection aimed at
reducing risk to a very low level, but not to zero.” (See Exhibit AUS-108: Biosecurity Australia (2003) Review of
the Australian Requirement for Petal Testing and Flower Cluster Examination at Blossoming for Pome Fruit from
1228
1229
296
Australia – Apples (DS367)
979.
Australia’s First Written Submission of Australia
18 July 2008
Accordingly, to demonstrate inconsistency with the first element of Article 5.5, New
Zealand will need to discharge the heavy evidentiary burden of establishing that there is in fact a
de facto distinction in ALOP being applied by Australia. Australia contends that on the basis of
the Japanese nashi pears comparison, New Zealand fails to do so. Australia demonstrates this
below.
(b)
The applied level of protection is a result of the measures applied to the
unrestricted risk
980.
In order to make its case that there are de facto distinctions in ALOP being applied by
Australia, New Zealand needs to establish what those levels of protection actually are.1232
981.
Australia recalls that risk management measures are implemented in order to achieve a
particular level of protection.1233 To determine the intensity of the measures required to achieve
ALOP, the gap between a Member’s ALOP and the risk associated with the importation of a
particular product is examined, and the measures formulated to bridge any gap between the two.
Therefore, differences in measures alone do not indicate the application of a different level of
protection. Such an extrapolation ignores the difference in levels of risk.
982.
The concept of ALOP is also known as “acceptable level of risk”.1234 The risk in relation
to a pest or disease is determined by combining the likelihood of entry, establishment and spread
with the associated consequences (including biological and economic). Accordingly, Australia
submits that any analysis and comparison of acceptable level of risk, or ALOP, must necessarily
involve a consideration of both likelihood and consequences. This is the first part of the analysis
required. The second part of the analysis involves assessing whether the measures applied
reduce the risk to a consistent level of protection.
983.
New Zealand argues that a difference in measures indicates that Australia has accepted a
higher level of risk in relation to Japanese nashi pears.1235 The reason for this, New Zealand
Japan, The Republic of Korea and The People’s Republic of China (“BA (2003) Pome fruit review”), p.11 and
Exhibit AUS-10: Biosecurity Australia (2003) Import Risk Analysis Handbook, Canberra, p.5).
1232
In Australia’s view, New Zealand has failed to identify how a level of protection applied is ascertained
in any given situation, and has failed to identify any particular level of protection applied by Australia.
1233
SPS Agreement, Article 5.6.
1234
SPS Agreement, Annex A(5).
1235
See, for example, New Zealand’s first written submission, paras. 4.439 (last sentence), 4.443 (last
sentence) and 4.480.
297
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
argues, is that Japanese Erwinia and fire blight present the same or similar risk, and that weaker
measures indicate that Australia applies a lower ALOP. Australia disagrees.
984.
Australia will instead demonstrate that there are differences in the likelihood and
consequences (together, risk) as between Japanese Erwinia and fire blight on the one hand, and
brown rot and European canker on the other, and that the measures required to meet ALOP
therefore differ. As the Panel will see, the risk profile for Japanese nashi pears is not, as New
Zealand inconsistently asserts, “comparable”1236 or “higher”1237.
985.
Notwithstanding Australia’s view that New Zealand has failed to properly compare the
levels of protection applying to New Zealand apples and Japanese nashi pears, Australia will, in
the interests of assisting the Panel, analyse the relevant levels of protection. Australia will firstly
examine the risk associated with each disease (and the associated product), followed by the
relevant measures applied to achieve ALOP.
(c)
There is a lower likelihood of entry, establishment and spread for Japanese
nashi pears compared to New Zealand apples
986.
New Zealand states that the importation of Japanese nashi pears involves a “risk of entry,
establishment and spread” of Japanese Erwinia and brown rot.1238 New Zealand does not,
however, engage in any analysis of the likelihood of entry, establishment and spread, or what
that likelihood might be in comparison with diseases associated with New Zealand apples.
New Zealand’s first written submission, para. 4.445.
New Zealand’s first written submission, paras. 4.443, 4.459.
Australia notes that New Zealand asserts in its written submission that “no IRA for Japanese nashi pears
has been released by Australia.” (paras. 4.439, 4.443) New Zealand apparently seeks to imply that no risk analysis
for Japanese nashi pears has ever actually been conducted. This is not the case. A pest risk analysis (PRA) for nashi
pears was conducted from 1988-1989 after Australia was approached by nashi pear growers from Tottori Prefecture.
The PRA was conducted on the basis that imports of nashi pears would be limited to Tottori prefecture. No other
prefectures requested market access for nashi pears to Australia. See Exhibit AUS-109: Department of Primary
Industries and Energy (1989) Quarantine Circular Memorandum (Plants) 1989/34: Importation of Nashi Pears
from Japan, 11 May 1989.
As part of the PRA, Australia assessed the operational standards in the field and in packing houses, and
concluded that Japan MAFF had an effective system in place (the system had been designed to meet
USDA/APHIS/Plant Protection & Quarantine standards). The PRA was circulated to the Chief Quarantine Officer
(Plants) in all states and the Northern Territory for comment. Based on the PRA, a trial shipment was pre-cleared in
September 1989.
1238
New Zealand’s first written submission, paras. 4.436, 4.440.
1236
1237
298
Australia – Apples (DS367)
987.
Australia’s First Written Submission of Australia
18 July 2008
Australia proceeds to demonstrate that key points of difference separate the assessment of
the likelihood of entry, establishment and spread between diseases associated with New Zealand
apples and Japanese nashi pears, including with respect to the presence of the diseases and the
volume of trade.
i.
The absence of Japanese Erwinia in export areas in Japan reduces the
associated likelihood of entry, establishment and spread
988.
As New Zealand correctly notes, Japanese Erwinia is restricted to Hokkaido island,
Japan.1239 However, New Zealand fails to note that Australia has only ever imported nashi pears
from Tottori prefecture on Honshu island, which is free from Japanese Erwinia and remote
geographically from Hokkaido. Australia has never imported nashi pears from Hokkaido, and
the import conditions are based on the assumption that pears would be sourced only from
Tottori.1240
989.
In any event, Japan notified to the IPPC the eradication of Japanese Erwinia from
Hokkaido in 2003.1241 Since then, Australia has received no notice of any new Japanese Erwinia
outbreaks in Japan (as required under the Australia’s import protocols).1242
Accordingly,
Australia submits that if the disease is no longer present in Hokkaido, and Australia only imports
nashi pears from Tottori prefecture, the basis for a comparison of the likelihood of entry,
establishment and spread (along with the basis of comparison of risk) disappears.
New Zealand’s first written submission, para. 4.436. See also, Exhibit AUS-110: Ministry of
Agriculture, Forestry and Fisheries of Japan (2003) Report on Free Status of the Bacterial Shoot Blight of Pear, 28
March 2003 (“MAF Japan (2003)”), which indicates that Japanese Erwinia was further confined to only Asahikawashi, Iwamizawa-shi, Kurisawa-cho and Mashike-cho in Hokkaido.
1240
Exhibit AUS-108: BA (2003) Pome fruit review, p26. In reviewing the quarantine measures applying
to Japanese nashi pears in 2003, Biosecurity Australia recognised that the nashi pears were “to be sourced only from
registered orchards in designated export areas of Tottori prefecture.” While Australia acknowledges that this
particular measure applies to brown rot, the effect is the same: nashi pears are not sourced from anywhere outside
of Tottori Prefecture.
1241
Exhibit AUS-110: MAF Japan (2003). In 1995, following identification of the disease in Hokkaido,
Japan implemented emergency controls. The controls consisted of designated control areas, a prohibition on the
movement of apple and pear plants and apple and pear fruit out of those control areas, cutting down and incinerating
or burying diseased pear trees and pear fruit within a radius of 40m from the diseased trees, and chemical control of
pear and apple trees within a radius of 500m. The controls ended in 1999. The disease was not detected from 19962002, during which time regular monitoring occurred.
1242
Exhibit AUS-108: BA (2003) Pome fruit review, p.63.
1239
299
Australia – Apples (DS367)
990.
Australia’s First Written Submission of Australia
18 July 2008
By comparison, fire blight is widely distributed in the apple-growing areas of New
Zealand, and New Zealand has not provided evidence to confirm that it has procedures in place
to establish, maintain and verify areas free from the disease.
991.
Australia contends that for a comparison of situations under Article 5.5 to occur, the
situations must be current. In Australia’s view, it is not possible to compare a current situation
with a past situation for the simple reason that the plant health status of Members changes over
time, as do trade volumes and risk management procedures.
ii.
The absence of brown rot in export areas in Japan reduces the associated
likelihood of entry, establishment and spread
992.
Japan has established that export areas in Tottori prefecture are free from brown rot and
has procedures in place to maintain and verify freedom from the disease.1243 Area freedom was
originally recognised by Australia in 1989 following the provision of survey, petal and flower
testing data by Japan.1244 Australia only imports Japanese nashi pears from Tottori Prefecture.
993.
By comparison, European canker is reported in several districts of New Zealand where
apple export orchards are located. New Zealand has not provided any data to demonstrate that it
has procedures in place to establish, maintain and verify either area freedom or areas of low pest
prevalence in relation to European canker and it expects Australia to import apples from areas
where European canker is prevalent.
iii.
The volume of trade in Japanese nashi pears is very much lower than the
likely trade in New Zealand apples
994.
The 1998 New Zealand apples IRA recognised that trade in nashi pears from Japan was
broadly comparable to trade in New Zealand apples in that it involved a susceptible host product
(i.e. nashi pears) from a country with a disease similar to fire blight (i.e. Japanese Erwinia).1245
1243
Exhibit AUS-108: BA (2003) Pome fruit review, p.61.
Exhibit AUS-111: Department of Primary Industries and Energy (1989) Quarantine Circular
memorandum (Plants) 1989/63: Fourth Australia – Japan Plant Quarantine Technical Discussions, 15 September
1989. Japan’s survey methodology was audited and verified by AQIS prior to the commencement of trade, and
since 1989, Japan has provided Australia with over ten years of survey, petal and flower testing data.
1245
Exhibit AUS-112: Australian Quarantine and Inspection Service (1998) Final Import Risk Analysis of
the New Zealand Request for the Access of Apples (Malus pumila Miller var. domestica Schneider) into Australia,
p27. Japanese nashi pears were addressed in the 1998 New Zealand apples IRA as a result of the Japanese Erwinia
1244
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However, it recognised several fundamental differences between the two situations, one of which
was the potential volume of trade.
995.
Logically, if there is no trade in a product, there is no risk that a pest or disease will gain
entry into a Member’s territory via trade in that product. Equally, the greater the volume of trade
in a product, the greater the risk that an associated pest or disease will gain entry (assuming that
the pest or disease is present in the source area to begin with).
996.
Taking this into account, there has been no trade in Japanese nashi pears between
Australia and Japan since 2003, when 36 tonnes were imported by Australia.1246 Prior to 2003,
the maximum volume imported in any one year since 1994 was 86 tonnes.1247
997.
By comparison, the most likely volume of trade in New Zealand apples estimated in the
Final IRA Report is 150 million apples per year, or approximately 27,000 tonnes.1248 Even New
Zealand’s more conservative estimate of 50 million apples1249 (approximately 9,000 tonnes) per
year dwarfs the past, and now non-existent, volume of trade in Japanese nashi pears. Again,
Australia reminds the Panel that to reasonably compare situations, those situations must be
current.
iv.
998.
Summary
Based on the above, Australia submits that the likelihood of entry, establishment and
spread of diseases associated with Japanese nashi pears (i.e. Japanese Erwinia and brown rot) is
much lower than the likelihood of those diseases associated with New Zealand apples (i.e. fire
blight and European canker). New Zealand has failed to establish otherwise.
outbreak in 1995. As eradication of Japanese Erwinia was notified in 2003, it wasn’t an issue that required
addressing in the 2006 New Zealand apples IRA.
1246
Exhibit AUS-113: Australian Quarantine and Inspection Service, Summary of Importation Statistics
for nashi pears from Japan, 1996-2003.
1247
Exhibit AUS-113: Australian Quarantine and Inspection Service, Summary of Importation Statistics
for nashi pears from Japan, 1996-2003.
1248
This figure is based on the Final IRA Report’s assumption that an average carton of 100 apples weighs
18kg: Final IRA Report, Part B, p.18.
1249
Exhibit NZ-56: New Zealand Ministry of Agriculture and Forestry, Comments by the Government of
New Zealand on Biosecurity Australia’s Revised Draft Import Risk Analysis Report for Apples from New Zealand,
December 2005, p1.
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Australia’s First Written Submission of Australia
18 July 2008
The potential consequences associated with Japanese nashi pears are much
lower compared with New Zealand apples
999.
New Zealand argues that Japanese Erwinia “involves comparable biological and
economic consequences for Australia” to fire blight.1250
Australia disagrees, and will
demonstrate below that, in Australia’s particular circumstances, this is incorrect.
i.
In Australia’s circumstances, the consequences associated with Japanese
Erwinia are lower than those for fire blight
1000. Australia accepts that Japanese Erwinia is a strain of bacterium similar and with similar
symptoms to Erwinia amylovora.1251
However, as New Zealand also notes, “in the field,
Japanese Erwinia has only been recorded on pears.”1252
This fact alone immediately
differentiates the potential consequences of Japanese Erwinia from fire blight. Given that the
Australian industry produces roughly half as many pears as apples, the difference in potential
economic consequences is obvious. Australia notes that New Zealand has failed to submit any
evidence in relation to the potential economic or biological consequences of Japanese Erwinia.
ii.
In Australia’s circumstances, the consequences of Monilinia fructigena are
lower than those for European canker
1001. New Zealand states that brown rot is a “fungal disease which is similar in many respects
to the European canker.”1253 Australia accepts that European canker and brown rot are similar
only to the extent that both are fungal diseases which can produce spores on fruit.
1002. New Zealand also contends that “the establishment and spread of Monilinia fructigena
into Australia involves comparable biological and economic consequences for Australia” as to
New Zealand’s first written submission, para. 4.438.
New Zealand’s first written submission, paras. 4.436-4.437.
1252
New Zealand’s first written submission, para. 4.437. Australia notes that Japanese Erwinia has been
closely identified with Erwinia pyrifoliae, a disease “demonstrably distinct” from E. amylovora (See Exhibit AUS114: Maxson-Stein K., McGhee G.C., Smith J.J., Jones A.L. and Sundin G.W. (2003) "Genetic analysis of a
pathogenic Erwinia sp. from pear in Japan" Phytopathology 93). Both E. pyrifoliae and Japanese Erwinia reportedly
“have a narrow host range, causing shoot blight only in pear trees” (See Exhibit NZ-68: Kim et al (2001)
“Molecular comparison of pathogenic bacteria from pear trees in Japan and the fire blight pathogen Erwinia
amylovora”, Microbiology 147, p.1023).
1253
New Zealand’s first written submission, para. 4.440.
1250
1251
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those of European canker.1254 In Australia’s view, New Zealand has failed to take into account
Australia’s particular circumstances.
1003. First, Jones and Aldwinkle (1990) note that brown rot (including M. fructigena) as a
disease of apple and pear “rarely cause[s] economic losses of apple and pear”.1255
1004. Secondly, Australia notes that brown rot, caused by M. fructigena, is only one particular
species of brown rot. Other species of brown rot are already present in Australia (for example,
Monilinia laxa and Monilinia fructicola)1256 and Australian industry already has controls in place
for these diseases that would also be effective for M. fructigena. As shown above, this is not the
case for European canker. Accordingly, the economic impact for the Australian apple and pear
industry would be lower if M. fructigena were to establish in Australia than if European canker
were to establish in Australia.1257
iii.
Summary
1005. Based on the above, Australia submits that the consequences of the diseases associated
with Japanese nashi pears are lower than those associated with New Zealand apples. New
Zealand has failed to establish otherwise.
(e)
The resulting risk associated with Japanese nashi pears is much lower than
the risk associated with New Zealand apples
1006. Australia first submits that it has clearly demonstrated above that the likelihoods of entry,
establishment and spread into Australia in relation to both Japanese Erwinia and brown rot are
much lower than the associated likelihoods in relation to fire blight and European canker.
Secondly, Australia submits that the consequences associated with Japanese Erwinia and brown
rot becoming established in Australia are also lower than those associated with fire blight and
New Zealand’s first written submission, paras. 4.441-4.442.
Exhibit AUS-115: Jones, A.L. and Aldwinckle, H.S. (1990) "Compendium of Apple and Pear
Diseases" The American Phytopathological Society, St. Paul, Minnesota, p.32.
1256
Exhibit AUS-116: Commonwealth Agricultural Bureaux International (CABI), Crop Protection
Compendium: Monilinia fructicola; Monilinia laxa , 2007 Edition.
1257
This notion is reflected by the Australian National Apple and Pear Industry Biosecurity Plan, which
assesses the consequences of European canker (Neonectria galligena) as “Moderate-High”, and consequences of
brown rot (Monilinia fructigena) as “Low”. The rating of “Low” is given because M. fructigena, if it were to
become established in Australia, could be treated with the same controls as currently used by industry for the other
species of brown rot already present in Australia.
1254
1255
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European canker. Accordingly, the risk associated with Japanese nashi pears is much lower than
the risk associated with New Zealand apples.
(f)
The measures applied for Japanese nashi pears demonstrate that Australia’s
ALOP is consistently applied
1007. The second stage of determining the level of protection actually applied requires an
examination of the measures applied in order to manage the risks associated with that product.
Here, those risks relate to Japanese Erwinia, fire blight, brown rot and European canker.
1008. New Zealand states that “Australia applies less restrictive measures regarding brown rot”
than European canker, “notwithstanding the higher risk profile for Japanese nashi pears.”1258
New Zealand also states with respect to Japanese Erwinia that the “substantial difference in
sanitary measures applied by Australia to nashi pears from Japan is evidence of a clear difference
in the level of protection applied when compared with apples from New Zealand.”1259
1009. Australia applies different measures to the two products because there are different risks
associated with them. As argued above, New Zealand has failed to properly take into account
the elements of risk, as relevant to Australia’s circumstances.
1010. To complete the second stage of analysis, Australia will briefly compare the measures
applying to each product.
i.
Measures in relation to freedom from disease or disease symptoms, as
verified by orchard inspections
1011. One of the measures applied by Australia to manage the risks of fire blight and European
canker in relation to apples from New Zealand is orchard freedom from visible symptoms of the
disease, as verified by orchard inspections. The detection of symptoms of either disease in an
export orchard would result in the suspension of exports from that orchard for the coming
season.
1012. In the case of brown rot, one of the measures that Australia applies to Japanese nashi
pears to manage the risk of brown rot is area freedom in Tottori Prefecture. Area freedom is
1258
1259
New Zealand’s first written submission, para. 4.443.
New Zealand’s first written submission, para. 4.439.
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certified by Japanese authorities, but AQIS officials are required to inspect a sample from export
orchards to confirm registration arrangements; hygiene and pest control; bagging of fruit; and the
absence of pests and diseases of quarantine concern.1260
1013. In the case of Japanese Erwinia, New Zealand claims that “Australia applies no measures
specifically relating to Japanese Erwinia other than a requirement to report its presence if
detected in a production area”.1261 This statement overlooks the fact that area freedom from
Japanese Erwinia is an ongoing requirement in relation to the importation of Japanese nashi
pears to Australia.
Japan has demonstrated its ability to ensure that area freedom is
maintained.1262
ii.
Measures in relation to surface contamination
1014. A second measure applied to manage the risk of fire blight is surface disinfection of
apples with chlorine or an equivalent treatment in the packing house. In the case of brown rot,
Australia requires fruit bagging.1263
iii.
General import requirements
1015. General import operational procedures required by Australia for New Zealand apples
include registration of export orchards and packhouses; notification of symptoms to AQIS; AQIS
systems audits of orchard inspections and packhouse procedures (at least for initial trade);
operation of orchards through standard commercial practice (including maintenance of details of
spray programs); secure storage; appropriate labelling; phytosanitary certification; and
notification of non-compliance to AQIS.
1016. For Japanese nashi pears, general import operational procedures include registration of
orchards; notification of brown rot (or unusual weather conditions resulting in brown rot) in
1260
Exhibit AUS-108: BA (2003) Pome fruit review, p.61.
New Zealand’s first written submission, para. 4.439.
1262
See earlier footnote regarding MAF Japan’s emergency controls in reaction to the Hokkaido outbreak.
1263
Exhibit AUS-108: BA (2003) Pome fruit review, p61. Australia notes that the risk of latent infection
from external infection sources is addressed by using bags to cover developing export fruits; the bags act as an
effective barrier to infection. Accordingly, New Zealand’s argument that fruit latently infected with M. fructigena
can produce spores after removal from cold storage becomes an irrelevant technical issue in the particular
circumstances.
1261
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Tottori prefecture and Japanese Erwinia in Japan;1264 AQIS inspections of export orchards to
confirm registration arrangements; hygiene and pest control; bagging of fruit; and the absence of
pests and diseases of quarantine concern;1265 AQIS inspection of pack houses before and after
harvest; provision of details of spray programs; secure storage; appropriate marking and sealing
of packages; and phytosanitary certification.1266
1017. Australia submits that the general operational procedures applying to each product are
not dissimilar.
(g)
Conclusion: New Zealand has failed to establish a distinction in Australia’s
ALOP
1018. Australia has demonstrated above that the likelihood and consequences associated with
Japanese nashi pears is lower than the likelihood and consequences associated with New Zealand
apples. Accordingly, the risk associated with the importation of Japanese nashi pears is lower
than that in relation to New Zealand apples. As a result of this lower risk, different measures are
required in order to achieve Australia’s ALOP. New Zealand ignores these important points, and
thereby fails to establish that Australia’s ALOP is not applied consistently.
1019. Australia finally notes that the Final IRA Report provides for a review of the import
conditions applying to New Zealand apples after one year of trade. 1267 A similar review of the
import conditions applying to Japanese nashi pears occurred after taking into account surveys or
export orchards, the history of trade and visits by Australian plant pathologists.
4.
Australia’s ALOP does not exhibit arbitrary or unjustifiable distinctions in its
treatment of different situations
1264
Exhibit AUS-108: BA (2003) Pome fruit review, p63.
Exhibit AUS-108: BA (2003) Pome fruit review, p61.
1266
Exhibit AUS-108: BA (2003) Pome fruit review, pp35, 61-63. When trade first commenced in 1989,
the measures applying to Japanese nashi pears also included a requirement that Japan provide the results of petal
tests and flower examination to Biosecurity Australia each year for the purpose of assessing and confirming that
Tottori Prefecture was free from brown rot, black spot and scab diseases. However, in 2003, Biosecurity Australia
reviewed this requirement and concluded that orchard inspections, pesticide programs and contemporary
management practices were sufficient so allow the requirement for petal and flower examination to be removed.
1267
Final IRA Report, Part B, p.325.
1265
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1020. The second element of the first sentence of Article 5.5 requires a complainant to establish
that distinctions in the levels of protection applied by the respondent Member are arbitrary or
unjustifiable.
1021. If, contrary to Australia’s submissions above, the Panel finds that there is a distinction in
ALOP applied by Australia, the Panel should examine the rationale behind that distinction to
determine whether it is arbitrary or unjustifiable.
1022. Treaty texts are to be interpreted in accordance with their ordinary meaning.1268
According to the ordinary meaning of “arbitrary” and “unjustifiable”, Australia submits that the
phrase “arbitrary or unjustifiable distinctions” in levels of protection means distinctions which
lack a reasoned basis or are unsupported by evidence.1269
1023. Australia applies its ALOP consistently with respect to apples from New Zealand and
nashi pears from Japan, and accordingly, there can be no finding of Australia adopting arbitrary
or unjustifiable distinctions in its treatment of different situations.
1024. Australia re-emphasises that different risks require different measures, and that different
measures alone are not a reasonable basis on which to find that different levels of protection are
being applied.
Australia considers that it has sufficiently shown that the reasons for the
differences in the measures applied in relation to Japanese nashi pears and New Zealand apples
relate to the different risks.
1025. In Australia’s view, New Zealand appears to have confused a difference in measures for
a difference in ALOP, and that by doing so, it has failed to prove that any de facto distinction in
ALOP exists.
Nevertheless, New Zealand has raised several arguments under the second
element, which Australia will proceed to address.
1026. New Zealand complains that, “prior to standard winter pruning, all trees in all rows of all
orchards/blocks registered for export to Australia need to be inspected (using ladders if needed)
for symptoms of European canker”, and that the “inspection requirements for brown rot in pears
1268
Article 31(1) of the Vienna Convention on the Law of Treaties.
The word “arbitrary” means, inter alia, “capricious” or “unreasonable”. The word “justify” means,
inter alia, to “confirm or support by evidence”. Accordingly, the word “unjustifiable” could be interpreted to mean
“unconfirmed or unsupported by evidence”. See: Brown, L (ed.), The New Shorter Oxford English Dictionary
(1993), Volume 1: A-M.
1269
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from Japan are much less prescriptive”.1270
Again, Australia notes that Japan offers area
freedom in relation to brown rot. New Zealand offers no area freedom in relation to European
canker.
1027. New Zealand also complains that “Australia also requires that AQIS officials be involved
in all such inspections.”1271
New Zealand has misunderstood this requirement.
AQIS
involvement in orchard inspections and packing house procedures is limited to AQIS conducting
systems audits only.
1028. New Zealand finally complains about a requirement that “orchard/block[s] be suspended
for the season on the basis that any evidence of pruning or other activities carried out before the
inspection could constitute an attempt to remove or hide symptoms of European canker.”1272 As
Australia has noted previously, Australia imposes no such requirement.
5.
The application of Australia’s ALOP in different situations does not result in
discrimination or a disguised restriction on international trade.
1029. The third element of the first sentence of Article 5.5 requires a complainant to establish
that arbitrary or unjustifiable distinctions in the ALOP applied by the respondent Member result
in discrimination or a disguised restriction on international trade.
1030. The Appellate Body stated in EC – Hormones that:
The third element must … be demonstrably present: the implementing measure
must be shown to be applied in such a manner as to result in discrimination or
a disguised restriction on international trade. The presence of the second
element -- the arbitrary or unjustifiable character of differences in levels of
protection considered by a Member as appropriate in differing situations -may in practical effect operate as a “warning” signal that the implementing
measure in its application might be a discriminatory measure or might be a
restriction on international trade disguised as an SPS measure for the
protection of human life or health.1273
1031. The Appellate Body’s statement makes it clear that establishing the second element of
Article 5.5 is not sufficient to satisfy the third element.
New Zealand’s first written submission, para. 4.446.
New Zealand’s first written submission, para. 4.447. (original emphasis)
1272
New Zealand’s first written submission, para. 4.448.
1273
Appellate Body Report, EC – Hormones, para. 215. Also, note: Appellate Body Report, Australia –
Salmon, para. 169.
1270
1271
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1032. Again, as Australia has demonstrated above, Australia is consistent in the application of
its ALOP. As the risks of the diseases associated with the importation of New Zealand apples
and Japanese nashi pears differ, the measures required to manage those risks also differ. The
differences in treatment are neither arbitrary nor unjustifiable, nor do they lead to any
discrimination or disguised restriction on trade.
Nevertheless, Australia will address New
Zealand’s arguments under the third element of Article 5.5 as follows.
(a)
New Zealand has failed to distinguish between discrimination and a
disguised restriction on trade
1033. New Zealand has failed to distinguish between the concepts of “discrimination” and
“disguised restriction on trade” in its claim in relation to Article 5.5. Nor has it identified which
of the two limbs it believes Australia to have contravened. This ambiguity makes it difficult for
Australia to respond.
1034. Australia draws the Panel’s attention to the framing of New Zealand’s arguments under
the third element. New Zealand begins by noting that the Australia – Salmon dispute recognised
a number of warning signals and other factors that “led to the conclusion that the levels of
protection imposed by Australia in that case resulted in a disguised restriction on trade.”1274
New Zealand then goes on to argue that many of the warning signals and other factors identified
in Australia – Salmon are also present in the present dispute, all of which “cumulatively show
that the distinctions in levels of protection imposed by Australia in this case result in a disguised
restriction on trade.”1275 Any mention of discrimination is notably absent.
1035. Then, throughout its discussion of the warning signals and other factors, New Zealand
refers to the first and third warning signals as indicating that a disguised restriction on trade is
present,1276 the first additional factor as initially indicating discrimination and a disguised
restriction on trade before later saying that it indicates a disguised restriction on trade,1277 and the
second additional factor indicating discrimination and a disguised restriction on trade.1278
New Zealand’s first written submission, para. 4.452. (emphasis added)
New Zealand’s first written submission, para. 4.453. (emphasis added)
1276
New Zealand’s first written submission, paras. 4.455, 4.462.
1277
New Zealand’s first written submission, paras. 4.463, 4.471.
1278
New Zealand’s first written submission, para. 4.474.
1274
1275
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Australia notes that New Zealand does not indicate the purposes for which the second warning
signal or third additional factor operate.
1036. New Zealand concludes its discussions by stating that distinctions in ALOP result in “a
discrimination or disguised restriction on trade”, followed by “discrimination and a disguised
restriction on trade.”1279
1037. Accordingly, it is unclear to Australia which of New Zealand’s arguments relate to which
limb of the third element. Given this, the Panel should only consider those warning signals and
additional factors which New Zealand has clearly indicated relate to the relevant limb.
(b)
Discrimination must be arbitrary or unjustifiable between countries where
identical or similar conditions prevail
1038. Australia submits that, in order to make a finding of discrimination, such discrimination
must be arbitrary or unjustifiable between countries where identical or similar conditions prevail.
Australia will explain this by examining the relationship between Articles 5.5 and 2.3.
1039. In EC – Hormones, the Appellate Body identified that Article 2.3 is an important part of
the context for the interpretation of the obligations in Article 5.5, and that “Article 5.5 may be
seen to be marking out and elaborating a particular route leading to the same destination set out
in Article 2.3.”1280 Further, in Australia – Salmon, the panel held that a violation of Article 2.3
can be presumed where a violation of Article 5.5 has been established.1281 If, as the Appellate
Body has indicated, this relationship of implied violation exists, the related elements in Article
2.3 and Article 5.5 need to be interpreted consistently.
1040. Article 2.3 only disciplines discrimination that is arbitrary or unjustifiable between
Members where identical or similar conditions prevail. In order for the scope of each provision
to be applied consistently, the same limitation should apply to Article 5.5; that is,
“discrimination” under Article 5.5 cannot logically have a broader scope than “discrimination”
New Zealand’s first written submission, paras. 4.480, 4.481. (emphasis added)
Appellate Body Report, EC – Hormones, para. 212.
1281
Panel Report, Australia – Salmon, para. 8.109.
1279
1280
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under Article 2.3. Accordingly, in Australia’s view, to demonstrate “discrimination” alone is
insufficient.1282
1041. Australia therefore submits that, in relation to the third element of Article 5.5, New
Zealand is required to show arbitrary or unjustifiable discrimination between Members where
identical or similar situations prevail. New Zealand has not done so.
(c)
There is no disguised restriction on international trade
1042. The panel in EC – Asbestos noted that the dictionary definition of “to disguise” implies
an intention.1283
The Oxford Dictionary defines “disguise” as referring to: “a means of
concealment or deception; a false appearance; concealment of reality under a false
appearance.”1284 Therefore, a focus on intention accords with the ordinary meaning of that term.
1043. In the present circumstances, Australia’s intention is to manage the risks associated with
importing New Zealand apples in accordance with its rights under the SPS Agreement. The
measures required by Australia reflect the risks arising from pests associated with New Zealand
apples. If New Zealand did not have fire blight, for example, Australia would not require the
same level of measures.
(d)
The warning signals and additional factors proposed by New Zealand do not
support a finding of discrimination or a disguised restriction on trade
1044. The Appellate Body has acknowledged that the arbitrary or unjustifiable character of
differences in levels of protection may operate as a “warning” signal in relation to the third
element, but no more. Given that there is no mention of “warning signals” in the text of the SPS
Agreement, Australia questions the status of these so-called “warning signals”. Australia
encourages caution in considering what weight to give any alleged signals that New Zealand has
identified. Australia also notes that the “other factors” referred to by the Appellate Body in
Australia – Salmon equally have no textual basis in the SPS Agreement.
1282
To explain, there are a larger number of subsets of discrimination within the broader notion of
“discrimination” than there are in the somewhat narrower notion of “arbitrary or unjustifiable discrimination”.
“Arbitrary or unjustifiable discrimination” is clearly a subset of “discrimination”. However, “justifiable
discrimination” (for example), while still being a subset of “discrimination”, is not a subset of “arbitrary or
unjustifiable discrimination”.
1283
Panel Report, EC – Asbestos, para. 8.236.
1284
Brown, L (ed.), The New Shorter Oxford English Dictionary (1993), Volume 1: A-M.
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1045. The Appellate Body has also recognised that these “warning signals” and “other factors”
are to be considered cumulatively.1285 Accordingly, any flaws in the “warning signals” and
“other factors” presented by New Zealand should lead the Panel to a finding that New Zealand
has failed to establish a prima facie case in relation to the third element of Article 5.5. Australia
will demonstrate such flaws as follows.
i.
Warning Signal 1 – “Arbitrary and unjustifiable character of differences in
the level of protection”
1046. New Zealand argues that the arbitrary or unjustifiable character of differences in levels of
protection may act as a warning signal.1286
1047. As Australia has demonstrated, Australia is consistent in the application of its stated
ALOP. The “distinction” that New Zealand alleges in fact relates to the different risk profiles of
New Zealand apples and Japanese nashi pears, and the measures required to manage those
different risks to a level that accords with Australia’s consistently applied ALOP. New Zealand
has therefore failed to substantiate “Warning Signal 1”.
ii.
Warning Signal 2 – “Extent of the difference in levels of protection”
1048. New Zealand argues that the extent of differences in levels of protection may act as a
warning signal.1287
1049. Australia reiterates its arguments in relation to “Warning Signal 1”, and notes that as
there are no distinctions in relation to Australia’s ALOP, the extent of any difference in levels of
protection cannot be considered. New Zealand has therefore failed to substantiate “Warning
Signal 2”.
iii.
Warning Signal 3 – “Inconsistency of the measures at issue with Article
5.1 of the SPS Agreement”
1050. New Zealand argues that the inconsistency of a Member’s measures with Article 5.1 may
operate as a warning signal.1288
Appellate Body Report, Australia – Salmon, para. 177.
New Zealand’s first written submission, para. 4.454.
1287
New Zealand’s first written submission, para. 4.456.
1285
1286
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1051. As Australia has demonstrated, the Final IRA Report is a valid risk assessment within the
meaning of Annex A, and Australia has accordingly acted in compliance with Article 5.1.
1052. New Zealand has therefore failed to substantiate “Warning Signal 3”.
iv.
Additional factor 1 – Level of “politicisation” in the New Zealand apples
IRA process
1053. New Zealand argues that an alleged “politicisation” of the IRA process operates as an
additional factor to take into account when determining discrimination or a disguised restriction
on trade.1289
1054. As previously noted, New Zealand’s claims of “politicisation” are spurious, unsupported
by evidence and should be disregarded by the Panel. Australia nonetheless reserves its right to
rebut these allegations in more detail at a later stage in these proceedings if necessary.
1055. New Zealand has failed to substantiate “Additional factor 1”.
v.
Additional factor 2 – “Undue delay”
1056. New Zealand argues that an alleged undue delay of the IRA process operates as an
additional factor to take into account.1290
1057. As Australia will demonstrate below, New Zealand’s undue delay claim under Article 8
and Annex C(1)(a) is outside the scope of the Panel’s terms of reference. Accordingly, the Panel
should not take this “additional factor” into account.
1058. Nevertheless, Australia wishes to draw the Panel’s attention to Annex 1, which sets out a
timeline for the IRA process from the dates of New Zealand’s market access request in 1999, to
the Director of Animal and Plant Quarantine’s Final Policy Determination for the importation of
apples from New Zealand in March 2007. As the Panel will see, Annex 1 fills in many of the
gaps visible in Annex 1 of New Zealand’s first written submission. Australia notes that the
New Zealand’s first written submission, para. 4.461.
New Zealand’s first written submission, para. 4.463.
1290
New Zealand’s first written submission, para. 4.472.
1288
1289
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18 July 2008
continued references by New Zealand to the Australian Senate Committee are irrelevant because
the Committee was not part of the IRA process.
1059. New Zealand has therefore failed to substantiate “Additional factor 2”.
vi.
Additional factor 3 – Absence of controls on the internal movement of
apples
1060. New Zealand argues that the absence of controls on the internal movement of apple fruit
during an outbreak of European canker in Spreyton, Tasmania, operates as an additional factor to
be taken into account.1291
1061.
In Australia’s view, the outbreak in Spreyton is entirely irrelevant. First, New Zealand
has cited Japanese nashi pears as the point of comparison for the purposes of Article 5.5. The
outbreak of European canker in Spreyton is completely unconnected to trade in Japanese nashi
pears. Hence, New Zealand has not made the correct comparison, which needs to be between the
respective products from Japan and New Zealand.
1062. Secondly, the outbreak of European canker in Spreyton precedes the SPS Agreement. A
comparison of how a disease outbreak was managed pre-SPS Agreement is inappropriate.
1063. Thirdly, Australia submits that Article 5.5 logically requires that the alleged
discrimination or disguised restriction on trade be current (i.e. that any alleged discrimination
between New Zealand apples and Spreyton apples be occurring at present).
As stated
previously, it is not possible to compare a current situation with a past situation for the simple
reason that the plant health status of each Member changes over time, as do trade volumes and
risk management procedures. In the present case, the methods of fruit storage and distribution
have also changed significantly since the 1950s.
1064. Fourthly, even if there were no restrictions on the movement of fruit from Tasmania, the
controls in place were equivalent to those proposed for New Zealand. In Spreyton, orchards
were regularly surveyed for diseases symptoms and affected trees were removed.
1065. New Zealand has therefore failed to substantiate “Additional factor 3”.
1291
New Zealand’s first written submission, para. 4.475-4.476.
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Australia – Apples (DS367)
6.
Australia’s First Written Submission of Australia
18 July 2008
Conclusion: New Zealand has failed to demonstrate that Australia applies its ALOP
inconsistently with Article 5.5
1066. Australia is consistent in the application of its stated ALOP. Any perceived differences
in treatment between New Zealand apples and Japanese nashi pears arise as a result of the
different risk profiles of the associated diseases and the markedly different volumes of trade.
Further, the “warning signals” and “additional factors” that New Zealand has presented to
evidence discrimination or a disguised restriction on trade are unsubstantiated.
1067. Accordingly, the argument that there are arbitrary or unjustifiable distinctions in the
application of Australia’s ALOP, and that those arbitrary or unjustifiable distinctions result in
discrimination or a disguised restriction on trade, does not bear fruit. New Zealand has failed to
establish otherwise and therefore there can be no finding of inconsistency with Article 5.5.
G.
NEW ZEALAND HAS ABANDONED ITS CLAIM UNDER ARTICLE 2.3
1068. As New Zealand has failed to establish a violation of Article 5.5, its consequential claims
in relation to Article 2.3 must also fail.
1069. In this regard, New Zealand has not provided any separate arguments in relation to its
claims under Article 2.3. Australia accordingly considers that New Zealand has, in effect,
abandoned its claims in relation to Article 2.3. In Australia’s view, the Panel should not rule on
Article 2.3.
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Australia – Apples (DS367)
H.
Australia’s First Written Submission of Australia
18 July 2008
AUSTRALIA’S MEASURES ARE CONSISTENT WITH ARTICLE 5.6
1070. New Zealand claims that alternative measures for the importation of New Zealand apples
are reasonably available to achieve Australia’s ALOP in respect of the risks associated with fire
blight, European canker and ALCM. The basis for New Zealand’s claim rests solely on its
contention that the unrestricted risks associated with the importation of New Zealand apples to
Australia are lower than the levels established in the Final IRA Report.
1071. On the basis of the risk assessment in the Final IRA Report, Australia disputes New
Zealand’s claim that the “alternative measures” it has identified would achieve Australia’s
ALOP. Accordingly, Australia’s measures are consistent with its obligations under Article 5.6.
1072. In addition, New Zealand’s misinterpretation of the three measures generally applicable
to the risk management for New Zealand apples, means that its challenge under Article 5.6 is
without basis.
1.
New Zealand must satisfy the three distinct elements of Article 5.6
1073. It is clear from the text of Article 5.6 and footnote 3 of the SPS Agreement that three
elements must be satisfied in order to establish a violation of Article 5.6. The complainant must
identify an alternative measure (or measures) which:

is reasonably available taking into account technical and economic feasibility;

achieves the Member’s appropriate level of SPS protection (ALOP); and

is significantly less restrictive to trade than the SPS measure(s) contested.1292
1074. These three elements are cumulative, so that failure to satisfy any one of the elements
means that the complainant’s claim under Article 5.6 must fail.1293 All three elements of Article
5.6 must be satisfied in relation to a particular alternative measure and cannot be satisfied
simply by “another measure” in the abstract.
Appellate Body Report, Australia – Salmon, para. 194; Appellate Body Report, Japan – Agricultural
Products II, para. 95.
1293
Appellate Body Report, Australia – Salmon, para. 194; Appellate Body Report, Japan – Agricultural
Products II, para. 95.
1292
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(a)
Australia’s First Written Submission of Australia
18 July 2008
Any alternative measure must meet the importing Member’s ALOP
1075. In Australia’s view, the most logical starting point of the Panel’s analysis should be the
second element identified above, namely an assessment of whether the purported “alternative”
measures identified by New Zealand would actually achieve Australia’s ALOP. A comparison
of particular measures’ relative trade-restrictiveness or reasonable availability is meaningless
without a determination that the particular alternative measure would achieve the ALOP.
Australia’s ALOP is not reviewable by a WTO panel or the Appellate Body.1294
1076. The Panel will therefore need to assess the capability of any “alternative” measure
identified by New Zealand to reduce the risks associated with the importation of New Zealand
apples to Australia, to a level that achieves Australia’s ALOP.1295
(b)
Any alternative measure must be reasonably available, taking into account
technical and economic feasibility
1077. Australia submits that the requirement that an alternative measure be “reasonably
available taking into account technical and economic feasibility”, pursuant to footnote 3 of
Article 5.6, highlights the need for such alternative measure to be a measure that a respondent
could reasonably implement in practice. The technical and economic feasibility of a proposed
alternative measure is a fundamental element for determining whether such measure should be
considered “reasonably available”.
This requires technical and economic feasibility to be
assessed “in the real world.”1296
Further, Australia considers that “the risk of incorrect
enforcement [of a measure] is part of the technical feasibility of a measure.”1297
(c)
Any alternative measure must be significantly less restrictive to trade
1078. It is clear that Article 5.6 does not require Members to adopt the least trade-restrictive
measure that is both reasonably available and would achieve a Member’s ALOP. Footnote 3 to
In Australia – Salmon, the Appellate Body recognised that: “The determination of the appropriate level
of protection, a notion defined in paragraph 5 of Annex A, … is a prerogative of the Member concerned and not of a
panel or of the Appellate Body.” (Appellate Body Report, Australia – Salmon, para. 199; original emphasis)
1295
See: Appellate Body Report, Australia – Salmon, paras. 204 & 208.
1296
Panel Report, Japan – Apples (Article 21.5 – US), para. 8.171.
1297
Panel Report, Japan – Apples (Article 21.5 – US), para. 8.171.
1294
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18 July 2008
Article 5.6 explicitly states that “a measure is not more trade-restrictive than required unless
there is another measure … [that is] significantly less restrictive to trade.”
1079. This requires a direct comparison between the disputed measure(s) and any alternative
measure, as to their relative trade-restrictiveness. The inclusion of “significantly” before the
words “less restrictive to trade” in footnote 3, means that it is not sufficient for a complainant to
identify an alternative measure that is merely less restrictive to trade than the existing
measure(s). The alternative measure must be significantly less trade-restrictive than the existing
measure(s) in order to find a violation of Article 5.6. Australia submits that the ordinary
meaning of the word “significant” is “important, notable, consequential”.1298
Thus, an
alternative measure would need to be less restrictive to trade by a degree which is important,
notable or consequential. Comparison of relative trade-restrictiveness of particular measures
needs to be undertaken by a panel on a case-by-case basis.
1080. As the panel in EC – Biotech Products acknowledged, as a result of potential
uncertainties in the result and conclusion of the relevant risk assessment:
… a given risk assessment may well support a range of possible measures.
Within this range, a Member is at liberty to choose the one which provides the
best protection of human health and/or the environment, taking account of its
appropriate level of protection, provided that the measure chosen is reasonably
supported by the risk assessment and not inconsistent with other applicable
provisions of the SPS Agreement, such as Article 5.6.1299
1081. Therefore, a panel must respect a Member’s right to choose its preferred measure, unless
there is another measure that is significantly less restrictive to trade.
2.
The alternative measures identified by New Zealand for fire blight and European
canker would not achieve Australia’s ALOP
1082. New Zealand claims that a “restriction of imports to apple fruit that are mature and
symptomless”1300 is a reasonably available alternative measure to address the risks associated
with fire blight and European canker on the basis that it would achieve Australia’s ALOP.
1298
Brown, L (ed.), The New Shorter Oxford English Dictionary (1993, Clarendon Press: Oxford).
Panel Report, EC – Biotech Products, para. 7.1525.
1300
New Zealand’s first written submission, para. 4.489.
1299
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18 July 2008
1083. Essentially, New Zealand’s claim is based on its view that the risk associated with
Australia importing “mature, symptomless apples” is “negligible” (in accordance with New
Zealand’s meaning of the term) in relation to both fire blight and European canker. New
Zealand argues that no additional risk management measures are required to achieve Australia’s
ALOP. Therefore, New Zealand’s argument under Article 5.6 rests on its opinion that the levels
of unrestricted risk determined in the Final IRA Report are false.
New Zealand has not
substantiated its claim that the “alternative” measure would actually mitigate any risks associated
with fire blight or European canker.
1084. Australia recalls that the Final IRA Report found the unrestricted risk associated with
both fire blight and European canker to be “low”.1301 Even though the IRA Team limited its
analysis to “mature apple fruit free of trash”,1302 it also considered the potential for “presence of
fire blight bacteria on mature symptomless apple fruit.”1303
As the IRA Team noted,
“E. amylovora cannot be detected by visual inspection.”1304 Similarly with European canker, the
IRA Team considered that “[t]he risk pathway of greatest concern to export with regard to
European canker is symptomless infection and infestation of fruit that cannot be detected by
inspection.”1305 Therefore, New Zealand’s proposed “alternative” measure – that imports be
limited to mature, symptomless apples – has already been factored in to the assessment in the
Final IRA Report for both fire blight and European canker, which nevertheless concluded that
the risk was “low” and in excess of Australia’s ALOP of “very low”.1306
1085. As the Final IRA Report is a valid risk assessment within the meaning of Article 5.1.
Australia is entitled to rely upon the Final IRA Report’s findings as to the unrestricted risks
associated with fire blight and European canker and the measures that should be taken to reduce
those risks to achieve Australia’s ALOP.
1086. Accordingly, the Panel must find that a requirement to limit imports to mature,
symptomless apple fruit would not achieve Australia’s ALOP without further risk management
measures. This would mean that New Zealand has failed to demonstrate that the “alternative”
1301
Final IRA Report, Part B, pp. 104 & 150.
Final IRA Report, Part B, p. 9.
1303
Final IRA Report, Part B, p. 52. (emphasis added)
1304
Final IRA Report, Part B, p. 52.
1305
Final IRA Report, Part B, p. 150. (emphasis added)
1306
See: Final IRA Report, Part B, pp. 104-105, 150.
1302
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18 July 2008
measure it has identified would achieve Australia’s ALOP, and therefore that New Zealand has
failed to show that Australia’s measures are inconsistent with its obligations under Article 5.6.
1087. Australia notes that New Zealand has also made the ambit claim that a requirement for
cold storage or a limitation to “retail-ready packaged fruit” would serve as “alternative”
measures for fire blight.1307 Also, in relation to European canker, New Zealand stated:
[A]lternative measures that would … be reasonably available, be less trade
restrictive and achieve Australia’s ALOP include restricting imports of apples
to those that are sourced from “pest-free places of production”, to be
determined by a single inspection of each exporting orchard and maintained
through controls on the subsequent movement of nursery stock, or limiting
imports to apples sourced from areas of “low pest prevalence” to be
determined by inspection of a sample of orchards.1308
1088. However, New Zealand explicitly chose not to substantiate its assertions in respect of
these “alternative” measures1309, and therefore the Panel should not consider these “measures” as
genuine “alternatives” under Article 5.6. Therefore, Australia submits that New Zealand has
failed to show that Australia’s measures for fire blight and European canker are more traderestrictive than required, on the basis that it has failed to identify a significantly less traderestrictive alternative measure that would achieve Australia’s ALOP.
3.
The alternative measure identified by New Zealand for apple leafcurling midge
would not achieve Australia’s ALOP or be significantly less trade restrictive
1089. New Zealand claims that Australia’s measures in regard to ALCM are inconsistent with
Article 5.6 on the basis of its argument that an inspection of a 600-fruit sample from each import
lot alone1310, is a reasonably available alternative measure that would achieve Australia’s ALOP
and is significantly less restrictive to trade. Once again, New Zealand’s claim rests on its flawed
opinion that the level of unrestricted “risk” determined in the Final IRA Report is false in respect
of ALCM. Furthermore, New Zealand has not shown that its “alternative” measure would be
significantly less restrictive to trade than Australia’s current measures for ALCM.
New Zealand’s first written submission, para. 4.490.
New Zealand’s first written submission, para. 4.491.
1309
New Zealand declared that it would “restrict its consideration to the alternative measure of restricting
imports to mature, symptomless apple fruit”: New Zealand’s first written submission, paras. 4.490 & 4.491.
1310
New Zealand’s first written submission, para. 4.513.
1307
1308
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(a)
Australia’s First Written Submission of Australia
18 July 2008
New Zealand’s alternative measure would not achieve Australia’s ALOP
1090. Australia has provided for two risk management options for ALCM:
inspection of a 3000-apple random sample of all export lots in New Zealand;
application of a suitable treatment (e.g. fumigation) or rejection of any relevant
lots will be required where ALCM is found; or
treatment of all lots with a suitable treatment (e.g. fumigation) for ALCM,
together with a standard inspection of 600-units per lot.1311
1091. New Zealand claims that an inspection of 600 fruit per lot would achieve Australia’s
ALOP on the basis that application of this measure would reduce the risk to “negligible”1312 (in
accordance with New Zealand’s meaning of the term), which is below Australia’s ALOP. But
New Zealand has not demonstrated that its “alternative” measure for ALCM would achieve
Australia’s ALOP on the basis of the level of risk calculated by the IRA Team. New Zealand
has assumed that the level of unrestricted “risk” for ALCM determined in the Final IRA Report
is false.
1092. Australia based its measures on the findings in the Final IRA Report, which indicate that
the unrestricted risk for ALCM is “low”1313, and therefore exceeds Australia’s ALOP. The IRA
Team assessed the “alternative” measure proposed by New Zealand, but found that a 600-unit
inspection system alone would not reduce the risks associated with ALCM sufficiently to
achieve Australia’s ALOP.1314 As New Zealand has failed to show that the Final IRA Report is
not valid, the Panel should find that New Zealand’s claim under Article 5.6 has not been made
out.
i.
The IRA Team’s statistical analysis of the measures for ALCM
1093. The IRA Team considered whether a 600-unit inspection alone would achieve Australia’s
ALOP for ALCM, but found that it did not.1315 In doing so, the IRA Team employed statistical
analysis to assess the rate of inspection that would be required to achieve Australia’s ALOP for
1311
New Zealand has acknowledged that an inspection of 600-units per lot is a standard quarantine
requirement to which it does not object: “A 600 unit sample … is not itself objectionable since it is commonly
undertaken for a range of quarantine pests.” (New Zealand’s first written submission, para. 4.138.)
1312
New Zealand’s first written submission, paras. 4.517-4.518.
1313
Final IRA Report, Part B, p. 187.
1314
Final IRA Report, Part B, pp. 188-190.
1315
Final IRA Report, Part B, pp. 188-190.
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18 July 2008
ALCM, short of visually inspecting every single apple. The IRA Team took into account both
its estimate that the unrestricted infestation rate for ALCM would be 4.1% (mean) of the total
proposed number of apples imported from New Zealand annually1316, and the August 2005 data
provided by New Zealand that the infestation rate of the varieties of New Zealand apples
exported to the United States (by the methods deployed) were between 0.1% and 0.38%.1317
1094. Alternative inspection rates of 600 units per lot and 3,000 units per lot were considered.
The IRA Team reasoned that the probability that ALCM would be detected in a lot of apples
which contains ALCM above a particular infestation level is more likely where there is a
relatively high infestation rate. For example, where a 600-unit sample is used, the probability of
at least 0.5% of apples in a lot being infested and therefore ALCM being detected, is higher
where the overall level of infestation of the lot is 0.5% or greater, depending on certain statistical
assumptions. Conversely, the 600-unit inspection rate would be less effective where the overall
infestation rate of lots is uniformly lower than 0.5%.1318
1095. The IRA Team found that “[a] 600 unit inspection is very effective in detecting lots
carrying pests” at an infestation rate of 4.1%.1319 However, the IRA Team’s analysis concluded
that if the infestation rate is as low as New Zealand’s information suggested it may be (i.e.
0.17%), then a 600-unit inspection system would not detect infestation in a certain proportion of
lots. At this rate, a 600-unit inspection system would allow lots to pass without treatment
resulting in a final importation rate of ALCM for the total imports of around 0.06%. When
placed in the model by the IRA Team this importation rate resulted in a restricted risk estimate
that exceeded Australia’s ALOP, indicating that, at least for infestation levels below 0.5%, an
inspection/treatment system based on a 600 fruit sample would not be adequate to manage the
risk for ALCM.1320
1096. A predicted ALCM infestation rate of 0.17% falls into the range of August 2005 data on
infestation rates (0.1%–0.38%) provided by New Zealand. The IRA Team explored the
relationship between sample sizes and the number of ALCM that could be imported for
1316
See: Final IRA Report, Part B, p. 165.
See: Final IRA Report, Part B, p. 166.
1318
New Zealand acknowledged in its written submission that an infestation rate of 0.5% “is greater than
the cocoon infestation level recorded on New Zealand apples”: New Zealand’s first written submission, para. 4.517.
1319
Final IRA Report, Part B, p. 190.
1320
Final IRA Report, Part B, p. 190.
1317
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18 July 2008
infestation rates between 0.1% and 0.38% using standard statistical techniques.1321 The IRA
Team concluded that, at infestation rates between 0.1% and 0.38%, a 3,000-unit inspection
system would result in a potential final importation rate for total imports of 0.005%, which
would achieve Australia’s ALOP. Lots that failed this inspection would either need to be
fumigated or withdrawn from export.1322
1097. An alternative measure for ALCM proposed in the Final IRA Report is the routine use of
a mandatory treatment such as fumigation for all lots, in addition to a standard 600-unit
inspection, which was also found would achieve Australia’s ALOP.1323
ii.
Limitations imposed by the appropriate standard of review
1098. As Australia argued above, application of the appropriate standard of review precludes a
panel from conducting a de novo review of whether a particular “alternative” measure would
achieve a Member’s ALOP, where the efficacy of such measure has previously been evaluated as
part of a risk assessment. It is clear that the IRA Team assessed the suitability of a 600-unit
inspection system to address the risks associated with ALCM, and found that it would not alone
be adequate to achieve Australia’s ALOP. Unless New Zealand can establish that the Final IRA
Report is not a valid risk assessment, the Panel should accept the IRA Team’s conclusion.
(b)
New Zealand’s alternative measure would not be significantly less trade-
restrictive
1099. Furthermore, New Zealand has failed to show that its “alternative” measure of a 600-unit
inspection for ALCM would be significantly less restrictive to trade than Australia’s current
measures.
1100. While Australia acknowledges that a 600-unit inspection requirement may be less
restrictive than Australia’s current measures, Australia submits that such a requirement would
not be significantly less restrictive to trade than the current measures.
1321
Australia refers the Panel to the tables of minimum sampling sizes to achieve particular confidence
levels that are set out in: Exhibit AUS-30: ISPM No. 31 (2008) Methodologies for sampling consignments.
1322
Final IRA Report, Part B, pp. 190-192.
1323
See: Final IRA Report, Part B, pp. 191-192.
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18 July 2008
1101. If the ALCM infestation rate of New Zealand apples is around 4.1%, then the IRA Team
found that with a 600-unit inspection rate, “apple leafcurling midge will be detected in
practically every lot and therefore [practically] every lot will be fumigated”, which would result
in a high degree of risk reduction.1324 Therefore, if the infestation rate is 4.1%, and a 600-unit
inspection results in detection of ALCM in most lots, requiring remedial treatment, then such a
measure would hardly be more trade-restrictive than Australia’s current option of a 600-unit
inspection plus mandatory treatment. If the ALCM infestation rate is around 4.1%, then New
Zealand’s proposed “alternative” measure would clearly not be significantly less restrictive to
trade than the existing measure.
1102. Furthermore, Australia is flexible about how the 3000-unit inspection measure could be
operationalised. Australia understands that New Zealand packing houses typically conduct a
600-unit pest inspection of each grower lot that is received by a packing house. Multiple grower
lots may be received in a day or processed in a single packing run, and go on to comprise a
single consignment. The 600-unit inspections per grower lot could be aggregated for the single
consignment, towards achieving the required 3000-unit inspection. In effect, this means that in
many cases there would be no additional requirement to that which New Zealand packing houses
already apply, and therefore minimal trade-restrictive effects.
1103. Australia notes that multiple units of inspection is not unusual for trade between Australia
and New Zealand.1325 For example, in respect of fresh fruit exports from Australia that pose a
risk of providing a vector for fruit fly, New Zealand requires each grower lot in a consignment to
be subject to a 600-unit inspection by a delegated inspector, followed by a further 600-unit
inspection of the consignment by AQIS, followed by mandatory treatment (dimethoate or methyl
bromide). Australia also understands that under some circumstances New Zealand apple exports
to the United States are already subjected to much higher inspection rates (up to 20,000 apples)
than that required by Australia.
1324
Final IRA Report, Part B, p. 190.
See: Exhibit AUS-93: Australia-New Zealand Bilateral Quarantine Arrangement: Systems Operation
Manual 7, February 2008.
1325
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18 July 2008
1104. Indeed, New Zealand appears to acknowledge in its written submission that its proposed
alternative measure is merely “less” restrictive to trade, rather than “significantly less”
restrictive.1326
1105. New Zealand has failed to establish that its proposed “alternative” measure for ALCM
would be significantly less restrictive to trade than Australia’s current risk management options.
4.
New Zealand has not identified any alternatives to the general measures
1106. New Zealand has asserted that there is “an alternative, less trade restrictive measure
reasonably available”1327 for “the requirements: (i) that AQIS officers be involved in inspection
for European canker and fire blight, in direct verification of packing house procedures, and in
fruit inspection and treatment; (ii) for verification of compliance with standard commercial
practices; and (iii) that packing houses provide details of the layout of their premises.”1328
However, New Zealand has failed to identify any genuine “alternative” or different measure to
those which Australia currently requires.
1107. New Zealand argues that an “alternative” to the first-mentioned requirement would be the
“simple auditing by AQIS officers of New Zealand systems applicable to the import apples to
Australia from New Zealand.”1329 As discussed above, New Zealand has misunderstood the
requirement in relation to the involvement of AQIS officers, to mean that it “require[s] the
involvement of AQIS officials in all inspections.”1330
However, as previously clarified,
Australia’s requirement in respect of AQIS officers is that they will conduct systems audits
only.1331 New Zealand’s description of potential AQIS systems audits accords with Australia’s
view of its requirement.1332 Therefore, New Zealand has not identified an “alternative” measure
because it is in fact the same requirement as that which Australia imposes.
1108. Furthermore, New Zealand has only attempted to identify a potential “alternative” in
relation to one of the three requirements – that is, the requirement of “AQIS involvement” – and
New Zealand’s first written submission, para. 4.522.
New Zealand’s first written submission, para. 4.525.
1328
New Zealand’s first written submission, para. 4.524.
1329
New Zealand’s first written submission, para. 4.525.
1330
New Zealand’s first written submission, para. 4.459. (original emphasis)
1331
Final IRA Report, Part B, p. 314.
1332
New Zealand’s first written submission, para. 4.527.
1326
1327
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18 July 2008
has failed to demonstrate how any “alternative” measure could replace the other two general
requirements. In particular, Australia’s requirement that “MAFNZ will ensure that all orchards
registered for export to Australia are operating under standard commercial practices” 1333, is not
related to New Zealand’s concern with “AQIS involvement” in inspections, etc. The measure as
challenged by New Zealand is:
The requirement that New Zealand ensure that all orchards registered for
export to Australia operate under standard commercial practices.1334
1109. Thus, the measure at issue is not any AQIS verification of this requirement – rather, the
challenge is against the substantive requirement that orchards must operate under standard
commercial practices. Thus, an “alternative” to the “AQIS involvement” requirement is not an
alternative to the standard commercial practice requirement.
1110. New Zealand has alleged that “Australia does not provide any justification” for its
requirement in respect of standard commercial practice.1335 This is clearly incorrect, as the Final
IRA Report makes it clear that the IRA Team assumed that New Zealand exporters would
operate under standard commercial practice throughout its assessment of the unrestricted risk
associated with importing New Zealand apples,1336 and therefore assurance was required that all
orchards registered for export to Australia would be operating under standard commercial
practices.1337
1111. New Zealand also challenges the justification for the requirement that packing houses
provide details of the layout of premises.1338 As explained above, a basic map of packing houses
is sought in order that AQIS officers can identify areas of potential risk in the packing houses in
preparation for the required packing house audits.
1333
Final IRA Report, Part B, p. 315.
New Zealand’s first written submission, para. 3.83; New Zealand’s panel request, p. 3.
Australia notes that New Zealand altered its expression of the “measure at issue” under Article 5.6 in its
written submission, referring to it as “verification of compliance with standard commercial practices”. (New
Zealand’s first written submission, para. 4.524.)
1335
New Zealand’s first written submission, para. 4.537.
1336
See, for example: Final IRA Report, Part B, pp. 54, 105, 114, 314.
1337
Final IRA Report, Part B, p. 315.
1338
New Zealand’s first written submission, para. 4.537.
1334
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1112. So, while New Zealand argues that Australia has not explained the basis for imposing the
two requirements, New Zealand has not actually identified any alternative measure for these
requirements and therefore has failed to support its claim under Article 5.6.
5.
Conclusion: New Zealand has failed to demonstrate that Australia’s measures are
inconsistent with Article 5.6
1113. Australia submits that New Zealand has failed to identify “another measure, reasonably
available taking into account technical and economic feasibility, that achieves the appropriate
level of [SPS] protection and is significantly less restrictive to trade”1339 for any of the measures
at issue in this dispute. Accordingly, New Zealand has failed to discharge its burden of proof
and accordingly there can be no finding of inconsistency with Article 5.6.
6.
New Zealand has abandoned its claim under the first requirement of Article 2.2
1114. New Zealand has devoted only a single paragraph in its first written submission in
support of any claim that Australia’s measures are inconsistent with the first requirement of
Article 2.2, which states: “Members shall ensure that any [SPS] measure is applied only to the
extent necessary to protect human, animal or plant life or health”. New Zealand’s argument is a
postscript to its arguments in relation to Article 5.6, stating:
… because [Australia’s measures] are more trade restrictive than required, the
measures also breach the requirement in Article 2.2 that measures be “applied
only to the extent necessary to protect human, animal or plant life or health.”
Australia has also, therefore, again, acted inconsistently with Article 2.2.1340
1115. New Zealand has failed to provide any explanation or argument as to why a finding under
Article 5.6 that measures are “more trade restrictive than required” should automatically lead to a
certain finding under Article 2.2. Australia notes that there has been no guidance provided by
previous panels or the Appellate Body on this question1341, and the respective texts of Article 2.2
and Article 5.6 make no mention of the other provision. It is clear that New Zealand is not
seriously pursuing its claim under the first requirement of Article 2.2. Accordingly, Australia
considers that, in the absence of any substantive argument, it appears that New Zealand has
1339
Footnote 3 to Article 5.6, SPS Agreement.
New Zealand’s first written submission, para. 4.540. (footnote omitted)
1341
Previous panels have opined simply that the first element of Article 2.2 is relevant context for
interpreting the obligation in Article 5.6: Panel Report, Japan – Agricultural Products II, para. 8.71; Panel Report,
Australia – Salmon, para. 8.165; Panel Report, EC – Biotech Products, para. 7.1433.
1340
327
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
effectively abandoned any claim1342 under the first requirement of Article 2.2 and the Panel
should refrain from considering the matter further.
1116. In any event, any outstanding claim in respect of the first requirement of Article 2.2 is
clearly dependent on the outcome of its claims in respect of Article 5.6. As Australia has shown,
New Zealand has failed to discharge its burden of proof in respect of Article 5.6, and has
accordingly also failed to make such a case in respect of the first requirement of Article 2.2.
1342
The Appellate Body has recognised that complainants may abandon certain claims during the course of
proceedings: see, Appellate Body Report, Japan – Apples, para. 136.
328
Australia – Apples (DS367)
I.
Australia’s First Written Submission of Australia
18 July 2008
NEW ZEALAND’S CLAIM THAT THE IRA PROCESS IS INCONSISTENT WITH
ARTICLE 8 AND ANNEX C(1)(A) FALLS OUTSIDE THE PANEL’S TERMS OF REFERENCE
1117. New Zealand claims that Australia is in violation of its obligations under Article 8 and
Annex C(1)(a) of the SPS Agreement because it failed to “undertake and complete the IRA
process without undue delay”.1343 However, the “IRA process” is not a measure at issue and is
therefore outside the scope of this dispute.
Accordingly, the Panel should dismiss New
Zealand’s claim.
1.
New Zealand has disregarded the Panel’s preliminary ruling
1118. Australia recalls the Panel’s preliminary ruling,1344 in which the Panel clearly limited the
scope of the measures at issue in the dispute, finding that, inter alia:
New Zealand’s panel request does not identify with sufficient precision any
measures contained in Australia’s [Final import risk analysis report for apples
from New Zealand], other than the 17 specific items identified through bullet
points. Accordingly, any such other measures are not part of this Panel’s terms
of reference.1345
1119. Australia fails to see how the “process for considering New Zealand’s request for access
for New Zealand apples to the Australian market”,1346 also referred to by New Zealand as the
“IRA process,”1347 falls within the scope of “the 17 specific items identified through bullet
points”. In Australia’s view, no possible characterisation of the 17 measures could encapsulate
the IRA process.
1120. Australia also notes that in limiting the scope of New Zealand’s panel request, the Panel
thus rejected the following statement from New Zealand’s preliminary written submission:
New Zealand’s first written submission, para. 4.546.
Preliminary Ruling of the Panel, Australia – Apples, 6 June 2008, WT/DS367/7.
1345
Preliminary Ruling of the Panel, Australia – Apples, 6 June 2008, WT/DS367/7, para. 13(b). (emphasis
1343
1344
added)
1346
1347
New Zealand’s first written submission, para. 4.541. (emphasis added)
For example, see New Zealand’s first written submission, para. 4.546. (emphasis added)
329
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
New Zealand considers that the Final IRA as a whole is inconsistent with
Australia’s obligations under the SPS Agreement. That is the essence of New
Zealand’s Article 8 and Annex C(1)(a) claim.1348
1121. Taking into account the above, Australia submits that New Zealand has disregarded the
Panel’s preliminary ruling by pursuing its undue delay claim under Article 8 and Annex C(1)(a).
2.
In any event, New Zealand’s panel request does not refer to the “IRA process”
1122. Notwithstanding the Panel’s preliminary ruling, Australia notes that nowhere in its panel
request does New Zealand refer to a “process for considering New Zealand’s request for access
for New Zealand apples to the Australian market” or the “IRA process”.1349 Consequently, as
the IRA process does not fall within the scope of New Zealand’s panel request, nor the terms of
reference of the Panel as clarified by the Panel, it equally cannot fall within the scope of an
undue delay claim. Accordingly, Australia submits that the Panel should reject New Zealand’s
claim under Article 8 and Annex C(1)(a).
3.
New Zealand has not made a case of undue delay in relation to any of the measures
at issue
1123. In Australia’s view, any claim of undue delay which New Zealand may have sought to
make would have to have been made in relation to the 17 measures. However, New Zealand has
not argued that any of the 17 measures are subject to a claim of undue delay. Rather, New
Zealand has framed its claim of undue delay with respect to the IRA process only.
1124. In any event, New Zealand has failed to discharge the burden of establishing a prima
facie case that the 17 measures are approval procedures within the meaning of Annex C(1). This
is yet a further reason for the Panel to dismiss New Zealand’s claim.
4.
New Zealand’s factual allegations are therefore irrelevant
1125. Given the deficiencies in New Zealand’s undue delay claim, Australia does not believe it
necessary to address the factual aspects of New Zealand’s claim. However, for the record,
1348
Written Submission of New Zealand, Request for a preliminary procedural ruling in relation to the
consistency of New Zealand’s panel request with Article 6.2 of the DSU, WT/DS367, 7 April 2008, para. 2.9.
(emphasis added)
1349
New Zealand, Request for the Establishment of a Panel by New Zealand, WT/DS367/5 (7 December
2007) (“New Zealand’s panel request”), p.1. (emphasis added)
330
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Australia does not accept any of New Zealand’s factual assertions with respect to its undue delay
claim, and reserves its right to address these assertions at a later time if necessary. Australia
repeats its view that New Zealand’s allegations of “politicisation” of the IRA process are
spurious and unsupported by evidence.
5.
Conclusion: New Zealand has not made a case under Article 8 and Annex C(1)(a)
1126. Neither the scope of New Zealand’s panel request, nor the Panel’s preliminary ruling on
New Zealand’s panel request, allow New Zealand to make a claim of undue delay in relation to
the IRA process. The Panel should therefore dismiss New Zealand’s claim of undue delay.
VII. CONCLUSION
1127. For the reasons set out in this submission, Australia requests the Panel to find that New
Zealand has not established a prima facie case that Australia’s measures are inconsistent with its
obligations under the SPS Agreement. Alternatively, if the Panel considers New Zealand has
established a prima facie case in respect of one or more measures, then Australia requests the
Panel find that it has rebutted that case on the basis of its evidence and legal argument.
331
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
ANNEX 1
TIMELINE FOR THE NEW ZEALAND APPLES IRA PROCESS
1999:

13 January: New Zealand lodges request for access of fresh apple fruit to Australia.

4 February: Technical discussions with New Zealand on the approach to the Import
Risk Analysis for New Zealand apples (IRA).

8 February: New Zealand lodges revised request for access of fresh apple fruit to
Australia.

25 February: Notification to stakeholders of commencement of IRA.

26 February: Further technical discussions between New Zealand Ministry of
Agriculture (MAFNZ) and AQIS.

15 April: AQIS invites stakeholder comments on proposed IRA process. Comment
period until 17 May.

2-7 May: AQIS visit to major production areas in New Zealand (Hawkes Bay and
Nelson/Blenheim)

28 June: AQIS advises stakeholders that IRA to follow normal risk analysis process
in the IRA Handbook 1998.

1-5 November: AQIS visits New Zealand.

17 December: AQIS and MAFNZ discuss IRA progress.
2000:

13 March: AQIS notifies stakeholders of delay in releasing draft IRA, as awaiting further
technical information.

25 July: AQIS advises stakeholders that technical work on the draft is substantially
complete with an anticipated release date in August, followed by a sixty day comment
period.

6 October: Biosecurity Australia (BA) established with responsibility for import risk
analysis.

11 October: First draft IRA released (215 pages) – BA advises comments period open
until 11 December.

11 December: BA receives New Zealand’s comments on the draft IRA.

19 December: BA meets with New Zealand to discuss its comments.

20 December: Comments period extended until 28 February to allow all interested
parties an opportunity to respond (100 submissions received at 11 December).
332
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
2001:
 28 February: Comments period on the 2001 draft IRA closes (142 submissions
received).

13-16 May: BA visit apple and pear growing areas in New Zealand information
gathering on New Zealand management of fire blight and other quarantine pests.

2 July: BA releases a draft inventory of issues raised by stakeholders in response to the
draft IRA for thirty day comment period.

6 August: BA receives New Zealand comments on the draft inventory of issues raised by
stakeholders in response to the draft IRA.

28 September: BA releases draft Guidelines for Import Risk Analysis for comments by
15 November - to address the need for increased transparency and stakeholder
consultation in the IRA process within the bounds of Australia’s international obligations,
government policy objectives, scientific rigour, administrative efficiency and
effectiveness and practicability.

8 October: BA notifies stakeholders of the proposed membership of the Risk Analysis
Panel for New Zealand apples and of the process to appeal this membership.

20 November: BA releases final inventory of issues raised by stakeholders in response to
the 2000 draft IRA, taking into account comments on the draft inventory (11 submissions
received on draft inventory).
2002:

Nine Risk Analysis Panel meetings held (outcomes of these meeting publicly available
on BA website).

Three Arthropod Technical Working Group and three Fungal Technical Working Group
meetings held.

10 January: BA advises Risk Assessment Panel membership.

4 July: BA publicly releases Scientific Review Paper to ensure transparency in the IRA
process and assist stakeholder contributions to ensure that the final IRA covers all major
scientific issues thoroughly and is based on the best available scientific evidence. Also
advice on stakeholder workshop.

22-23 July: Stakeholder workshop held in Melbourne to explain Scientific Review
Paper, New Zealand Government officials among the attendees.

9-10 September: Two Risk Assessment Panel members visit New Zealand apple
growers/packers.
2003:

Seven Risk Assessment Panel meetings held –considering extensive stakeholder
comments on the 2000 draft IRA and reviewing relevant scientific evidence. (summaries
of these meeting publicly available on BA website).
333
Australia – Apples (DS367)

Australia’s First Written Submission of Australia
18 July 2008
2003: Ongoing Fungal Technical Working Group and Anthropod Technical Working
Group meetings.
2004:

Eight Import Risk Analysis Team (formerly Risk Assessment Panel) meetings held.

19 February: BA releases revised draft IRA (722 pages).

31 March: BA releases the risk estimation methodology used in the revised draft IRA
2004 (publicly available on its website).

23 June: Comments period closes on revised draft IRA (comments period extended twice
to ensure sufficient time for stakeholders to review the scientific content and provide
meaningful feedback, taking into account key stakeholder involvement in apple harvest).
(around 200 submissions received).

16 August: Eminent Scientists Group established to independently examine all final draft
IRAs before their release and ensure Import Risk Analysis Teams have adequately
considered all technical submissions received from stakeholders.

1 December: BA established as a prescribed agency (financially independent from the
Department of Agriculture, Fisheries and Forestry). BA to review all IRAs in process and
reissue them as revised drafts for further comment.
2005:

Nine Import Risk Analysis Team meetings held.

Ten meetings held with stakeholders in major apple growing areas in Australia to clarify
issues raised in their submissions on the revised draft IRA.

12 April: BA meets with New Zealand MAFNZ to clarify issues raised in its submission
on the revised draft IRA.

2 June: BA meets with New Zealand to further discuss issues raised.

1 December: Draft IRA (371 pages) reissued for comments for 120 days to ensure
stakeholders have sufficient time to absorb and comment on the very substantial and
detailed material contained in it.
2006:

Five Import Risk Analysis Team meetings held.

1 February: BA releases the risk estimation methodology used in the revised 2005 draft
IRA (publicly available on BA website).

9 March: BA meets with New Zealand government and industry in Wellington to assist
MAFNZ to prepare its submission on the 2005 draft IRA.

30 March: Comments period closes on 2005 draft IRA (34 submissions received).
334
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008

7 June: BA meets with New Zealand to clarify some issues arising from New Zealand’s
submission to the 2005 draft IRA.

1 August: BA advises that the draft final IRA has been referred to the Eminent Scientists
Group for review.

October: Eminent Scientists Group report – concluding stakeholder comments properly
considered - provided to Australia’s Director of Animal and Plant Quarantine.

30 November: BA releases Final IRA for apples from New Zealand.

1 December: BA met with New Zealand to outline the measures in the final IRA in
Wellington.
2007:

12 January: Appeal period closes for the final IRA (3 appeals lodged – New Zealand did
not appeal).

31 January: BA meets with New Zealand to discuss technical details of the final IRA
2006.

26 February: Appeals considered and disallowed.

26 March: Australia’s Director of Animal and Plant Quarantine issues a Final Policy
Determination for importation of apples from New Zealand.

21-22 June: AQIS visit to New Zealand to take part in New Zealand workshop on its
certification systems and procedures and inspection of New Zealand orchards and packhouses.

31 August: New Zealand request consultations with Australia under Article 4 of the
DSU.

4 October: Consultations with Australia held, the United States and the European
Communities attend as third parties.

6 December: New Zealand request establishment of a panel under Article 6.1 of the
DSU.
2008:

21 January: Panel established.

11-12 February: BA and New Zealand technical discussions to clarify the import
operational procedures for New Zealand apples .

12 March: Director-General composes panel at New Zealand’s request, Chile, Chinese
Taipei, European Communities, Japan, Pakistan and the United States reserve their rights
to participate as third parties.

March 2008, AQIS advises New Zealand that the draft operational framework to give
effect to the IRA requirements - Standard operating procedure (SOP) and work plan –
could be finalised, subject to a few minor amendments by New Zealand.
335
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008

20 June: New Zealand lodges its first written submission in the WTO dispute.

15 July: New Zealand advises AQIS that it is not in a position to agree to the draft SOP
and work plan.
336
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
ANNEX 2
AUSTRALIA’S REVIEW OF ANNEX 3 OF NEW ZEALAND'S FIRST WRITTEN
SUBMISSION
Bureau of Rural Sciences
11 July 2008
Summary
In response to a request from Biosecurity Australia, the Bureau of Rural Sciences (BRS)
conducted a preliminary review of Beresford and Kim’s ‘An analysis of climate requirements for
establishment of European canker’ (2008; Annex 3 of the New Zealand WTO submission
WT/DS367).
The BRS analysis is restricted to climatic and host factors influencing the potential for European
canker to establish in Australia. It is based on a search of the data available within a limited time
and there is scope, with more time, to refine the analysis further and investigate other aspects of
the Beresford and Kim paper. The main findings of this preliminary analysis are:

BRS CLIMATE mapping based on the Beresford and Kim climatic parameters indicates a
much larger area of potential canker establishment in Australia than their analysis suggests.
A recent CLIMEX® model output – based on a more complex set of biogeographic
parameters than CLIMATE provides – indicates an even larger area of potential
establishment in Australia.

Analysis of long-term temperature and rainfall averages shows that specific Australian
locations (e.g. Melbourne and Sydney) are within the climatic limits for canker suggested by
Beresford and Kim – for example, Melbourne has a very close match to Nelson in New
Zealand.

Furthermore, the climatic parameters used by Beresford and Kim are considered to be too
restrictive based on: the establishment and persistence of European canker in Tasmania
between 1950 and 1974; and their not taking into account the entire global distribution of
European canker.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
CLIMEX and CLIMATE modelling
CLIMEX®, developed by CSIRO, can be used for matching general climate zones where a
species can establish. The potential distribution of European canker in Australia was predicted
based on published records of European canker occurring outside Australia and New Zealand
and the regional match climate function available in CLIMEX® (Figure 1). The regional match
climate function provides a comparison of climates in different regions for maximum and
minimum temperature cycles and rainfall patterns with Australian and New Zealand long-term
weather data. The climate match prediction in Figure 1 is similar to that determined by Edwards
et al (2007; Appendix 1) and indicates that European canker could even establish in the coastal
regions of northern sub-tropical and tropical eastern Australia and the establishment potential is
similar to that of New Zealand regions that are known to have European canker.
Figure 1. The potential distribution of European canker in Australia and New Zealand (not to
scale) predicted using the Regional Match Climate function in CLIMEX® Version 3. Circles
indicate average of climatic indices where establishment can occur. Red circles indicate more
suitable climates.
Beresford and Kim (2008) acknowledge that European canker occurs in south-eastern England
(Kent), where the rainfall is only around 600 – 700 mm. This indicates the potential for a wider
distribution than in the earlier import risk analysis (IRA) undertaken by Biosecurity Australia
(Biosecurity Australia 2006), which suggested a minimum of 1000 mm annual rainfall is
required for establishment. Using the limited geographical data reported by Beresford and Kim
and excluding the Australian points – because European canker is not currently in Australia – it
is possible to determine which Australian regions match the Beresford and Kim data points (n =
8 records) using CLIMATE software developed by the Bureau of Rural Sciences. The climate
match (Figure 2) produced from this restricted dataset indicates a significant climatic overlap
with the major commercial pome fruit regions in Australia (Figure 3) and was a very close match
with the CLIMEX® model produced in Figure 1.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Nelson
Melbourne
Figure 2. Australian and New Zealand regions (not to scale) matching the climatic requirements
of European canker with the climatic conditions of overseas locations identified as having
European canker present (analysis completed with CLIMATE software; red indicating the
regions of greater suitability, green and blue less suitable). Approximate location of Nelson
(New Zealand) and Melbourne (Australia) are indicated.
Figure 3. Major pome fruit regions of Australia (Australian Natural Resource Atlas 2007).
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Factors influencing the establishment of European canker
Beresford and Kim (2008) indicate that establishment of European canker requires 30% of days
to have rain during leaf-fall and temperatures of between 11oC and 16 oC for more than 8 hours.
Peripheral cankers can occur when rainfall is lower indicating latent infection and records for
East Malling (England) indicate that October (mid-autumn in Northern Hemisphere), when
temperatures are relatively warm and rainfall occurs on 27% of days, is also conducive to
infection.
The Beresford and Kim analysis recognises that regions with rainfall as low as 650 mm per
annum have the potential for infection. Therefore the IRA, which included Australian regions
with rainfall greater than 1000 mm, should be broadened to include regions with lower rainfall
and/or overhead irrigation occurring in months with suitable temperature ranges for infection.
Historical evidence for persistence of canker in Australia
Beresford and Kim reported that an outbreak of European canker persisted ‘without any signs of
spread’ in Spreyton, Tasmania for more than 20 years between 1950 and 1974 despite the
macroclimatic conditions being apparently unsuitable for European canker. They go on to
suggest that this means the climatological criteria (>30% of days with rainfall and temperatures
of between 11oC and 16 oC for more than 8 hours per day) used to predict suitable infestation
sites would over-predict the risk. In fact the persistence of European canker in this region for so
long despite an intensive eradication campaign actually indicates that the climatic criteria used
by Beresford and Kim are too limited for accurate prediction of establishment and that the
microclimatic conditions are not adequately accounted for and appear to be a significant
determinant of establishment potential. It should also be noted that Spreyton was not a major
apple producing region of Tasmania in the 1950s and was relatively isolated from other regions
(Figure 4). Spread was likely to have been limited in this instance as a result of the intensive
eradication campaign rather than inherent climatic unsuitability, because the CLIMATE analysis
presented in Figure 2 indicates substantial areas of climatic suitability in Tasmania.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Spreyton
Figure 4. Location of Spreyton, site of the Tasmanian European canker outbreak (source:
Ransom 1997) and the major apple production areas in Tasmania in 1950 (Ashton 1950).
Global distribution
The climatic data used by Beresford and Kim (2008) included a restricted number of weather
stations with many of the stations being in close geographical proximity (e.g. two weather
stations from East Malling in England). Beresford and Kim’s climatic data was reduced by BRS
to eight location references when the Australian weather stations were removed for the
CLIMATE analysis in Figure 2. Apart from its distribution within Europe, European canker has
been reported to occur in areas of South Africa, Canada, the USA, South America and Asia
(Figure 5). A literature review undertaken by Edwards et al (2007) reported that European canker
had also been found in Indonesia (Java), USA (Florida, Louisiana) and in arid regions, such as
Saudi Arabia, Syria and Afghanistan, as well as in sub-artic regions such as Iceland, Sweden and
Canada (Nova Scotia). Predicting the distribution of European canker in Australia should
consider the global distribution identified through CABI records and the locations identified by
Edwards et al (2007) data for these regions in addition to the New Zealand, east England and
Chilean data cited by Beresford and Kim. Additional data on the global distribution could also be
revealed if a detailed search for records using the historical synonyms for European canker were
undertaken (Appendix 2).
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Figure 5. Countries where European canker has been reported as occurring indicated by yellow
circles; green circles indicate countries with historical records of European canker but assume
successful eradication has occurred. Colours indicate regions of climatic similarity (source:
CABI).
Comparison of weather patterns for Nelson (New Zealand) and Melbourne (Australia)
Although Beresford and Kim suggest that predicting European canker establishment on climate
alone is not adequate, it is important to note that in the vicinity of Nelson (New Zealand) it has
not been possible to eradicate European canker to date, and there are many regions in Australia
with climatic conditions similar to that of Nelson. Using the most recent Bureau of Meteorology
data for Melbourne (July 2007 to June 2008, which was a warm, dry period occurring during a
protracted drought) and the wettest year for Nelson (2004; National Climate Database, New
Zealand) a comparison of the frequency of days with similar temperatures, rainfall and humidity
shows similar patterns for the pome harvest period, January to April (Figures 6 – 9). A more
detailed representation of this data showing these daily climate parameters sequentially is
provided at Appendix 3.
20
18
Melbourne 2008
Nelson 2004
16
Frequency (days)
14
12
10
8
6
4
2
0
1
6
11
16
21
26
31
36
41
Minimum temperature (degrees C)
Figure 6. Comparison of the frequency (days) of minimum temperatures in Melbourne,
Australia and Nelson, New Zealand for January to April inclusive.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
20
Melbourne 2008
Nelson 2004
18
Frequency (days)
16
14
12
10
8
6
4
2
0
1
6
11
16
21
26
31
36
41
Maximum temperature (degrees C)
Figure 7. Comparison of the frequency (days) of maximum temperatures in Melbourne,
Australia and Nelson, New Zealand for January to April inclusive.
120
Frequency (days)
100
80
60
Melbourne 2008
Nelson 2004
40
20
0
1
25
50
75
100
Rainfall (mm)
Figure 8. Comparison of the frequency (days) of rainfall volumes for Melbourne, Australia and
Nelson, New Zealand for January to April inclusive.
25
Frequency (days)
20
Melbourne
2008
Nelson 2004
15
10
5
0
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
90
95 100
Relative humidity (%)
Figure 9. Comparison of the frequency (days) with relative humidity levels for Melbourne,
Australia and Nelson, New Zealand for January to April inclusive.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
The data provided for Nelson in Annex 3 of the New Zealand submission and the most recent
data from the Australian Bureau of Meteorology for Melbourne and Sydney was used to examine
these sites in relation to the climatic criteria used by Beresford and Kim – i.e. 8 hours of
temperature between 11–16oC and 30% of days with rain. The results of this analysis (Figure 10)
indicate the seasonal similarity of these regions. Based on these criteria, Melbourne, with many
of its backyards containing pome fruit trees or alternate hosts, is an example of just one potential
establishment site in Australia for European canker. Further, based on long-term averages,
Sydney, a major entry point for pome imports, is warmer and has more summer rainfall; but all
months have over 30% of days with rainfall events of 1 mm or more and several months would
have periods where establishment is possible.
18
Daily average hours between 11 and 16 degrees C
rain day = 30%
A. Spring
16
14
12
Mel10
Syd9
10
Mel9
Nel10
Ne
Nel9
Mel11
8
temperature = 8 hours
6
4
Syd10
Syd11
2
0
0
30
60
Percentage of days with rain
90
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
18
B. Summer
Daily average hours between 11 and 16 degrees C
rain day = 30%
16
14
12
10
8
Nel12
6
Nel2 Nel1
4
Mel12
temperature = 8 hours
Mel2
2
Mel1
Syd1
0
0
30
Syd12
Syd2
60
90
Percentage of days with rain
18
Daily average hours between 11 and 16 degrees C
rain day = 30%
C. Autumn
16
Mel5
14
Syd5
12
Mel4Nel5
Nel4
10
8
Nel3
temperature = 8 hours
Syd4
6
Mel3
4
2
Syd3
0
0
30
60
Percentage of days with rain
90
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
18
Daily average hours between 11 and 16 degrees C
Mel6
D. Winter
16
Syd6
14
Mel8
12
Syd7
Syd8
Mel7
10
8
temperature = 8 hours
Nel8
Nel6
6
Nel7
4
2
rain day = 30%
0
0
30
60
90
Percentage of days with rain
Figure 10. Climatic suitability for European canker establishment in Melbourne, Sydney and
Nelson using the rainfall and temperature criteria cited by Beresford and Kim (derived from
Dubin and English 1975). The first three letters of each plotted point represent the locality name
(Mel = Melbourne, Syd = Sydney, Nel = Nelson) and the numeric postfix represents the month
of the year (where January is ‘1’) for: A. Spring; B. Summer; C. Autumn; and D. Winter.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Non-commercial hosts of European canker (host list from www.cabicompendium.org.cpc)
Another factor not considered in the Beresford and Kim analysis is the availability of alternate
hosts. European canker has an extensive host range of more than 60 species in 20 genera and
many of these plants are used as amenity plantings or occur in gardens in Australia.
Primary hosts
CABI compendium (CABI) identifies four primary hosts of European canker (Nectria
galligena): the commercially-grown fruiting apple (Malus domesticus) and pear (Pyrus
communis) and the ornamental trees sugar maple (Acer saccharum) and yellow birch (Betula
alleghaniensis). The non-pome primary hosts are sold for ornamental plantings in Australia but
information on the full extent of their range is not readily available. CABI returns host
information only where European canker has been recorded on a host; hence it is likely that other
ornamental species (e.g. Pyrus spp. such as Manchurian pear—Pyrus ussuriensis and callery
pear—Pyrus calleryana; Acer spp. including box elder—Acer negundo and Japanese maple—
Acer palmatum) prevalent in street tree plantings in Sydney and Melbourne and grown
extensively in private and public gardens, are potential hosts.
Secondary hosts
Forty-eight secondary hosts were identified and of these, the white willow (Salix alba) is widely
planted in Australia according to Australian Virtual Herbarium geographic records (Figure 11).
The tulip tree (Liriodendron tulipifera) is prevalent in street tree plantings in Sydney (City of
Sydney 2006) and the scarlet oak (Quercus coccinea) in Melbourne street tree plantings (City of
Melbourne n.d.). Other widely planted potential hosts within genera listed as secondary hosts
include cherries (Prunus spp., Figure 12) and willows (Salix spp., Figure 13) – both grown
extensively in ornamental plantings. Poplars (e.g. secondary host Populus tremuliodes) are also
prevalent in private gardens.
Figure 11. Map of Australian Virtual Herbarium collection records of Salix alba.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Figure 12. Map of Australian Virtual Herbarium collection records of Prunus spp.
Figure 13. Map of Australian Virtual Herbarium collection records of Salix spp.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Conclusions
BRS analysis indicates that conditions exist in a wide range of geographical locations within
Australia to present a substantial risk of establishment of European canker in Australia, even
when based on the Beresford and Kim climatic parameters (>30 days of rainfall and
temperatures of between 11–16 oC for more than 8 hours per day) which BRS consider to be too
restrictive.
Detailed comparisons of Nelson (a vicinity in which it is known that European canker exists)
with Melbourne and Sydney also demonstrate a similarity in climatic conditions – even when
deliberately conservative data are used (e.g. comparing a wet year in Nelson with a dry, warm
year in Melbourne).
The New Zealand assertion that the failure of the former Tasmanian European canker infection
to spread to the mainland indicates that there is no risk of permanent establishment in Australia
is not considered valid. European canker persisted in Tasmania for more than 20 years and its
containment and removal was most likely due to an extensive eradication campaign and the
isolation of the original outbreak (i.e. non-contiguous distribution of primary hosts into
surrounding regions) rather than unsuitability of the local climate.
Maps and graphs presented in this analysis show a considerable degree of overlap between
regions of climatic suitability for European canker in Australia with commercial pome
production areas and potential pome import ports in Australia.
In addition, a wide range of alternative hosts for European canker, which could facilitate the
spread of any initial canker establishment into commercial pome production areas, occur in
Australian urban and peri-urban locations.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
References
Ashton L.G. (1950) The Tasmanian Apple and Pear Industry. Bulletin 6, Bureau of Agricultural
Economics, Canberra.
Australian Natural Resource Atlas (2007) Agriculture - National Horticulture Industry Profiles Pome Fruit. http://www.anra.gov.au/topics/agriculture/pubs/national/pome_fruit.html, accessed
27 June 2008.
Australian Virtual Herbarium: (AVH) data http://www.anbg.gov.au/cgi-bin/avhxml.cgi Accessed
2 July 2008.
Beresford R. and Kim K.S. (2008) Annex 3 An analysis of climate requirements for
establishment of European canker. In :First written submission from New Zealand Australia –
Measures Affecting the Importation of Apples from New Zealand (WT/DS367).
Biosecurity Australia (2006) Final import risk analysis report for apples from New Zealand Part
B, Biosecurity Australia, Canberra, 376 pp.
City of Melbourne (N.D.) Local area tree planting plans
http://www.melbourne.vic.gov.au/info.cfm?top=26&pa=642&pg=644 Accessed 3 July 2008.
City of Sydney (2006) Street tree master plan Sydney
http://www.cityofsydney.nsw.gov.au/Council/documents/policies/StreetTreeManagement/Street
TreeManagementPolicy/MasterplanVolume3PartD.pdf Accessed 3 July 2008.
Climatic Research Unit (CRU) (2007) High-resolution gridded datasets, Climatic Research Unit
and the Tyndall Centre, Norwich: http://www.cru.uea.ac.uk/cru/data/hrg.htm Accessed 10 July
2008.
Dubin H.J. and English H. (1975) Epidemiology of European canker in California.
Phytopathology 64: 1201 – 1203.
Garden centres of Australia list of members:
http://www.gardencentresaust.com.au/members.htm.
Edwards J., Villalta O.N. and Powney R. (2007) Predicting the potential distribution of
Neonectria galligena (European canker) in Australia using the models CLIMATE and
CLIMEX®. 16th Biennial Australasian Plant Pathology Society Conference
Back to Basics: Managing Plant Disease incorporating the 9th Annual Australasian Mycological
Society Meeting. Adelaide Convention Centre South Australia
24-27 September 2007.
Ransom L.M. (1997) The eradication of Nectria galligena from apple trees in Tasmania, 1954 –
1991. Australasian Plant Pathology 26: 121 – 125.
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Appendix 1: Potential distribution of Neonectria galligena using climate modeling software (Edwards et al 2007)
Australia – Apples (DS367)
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18 July 2008
Appendix 2: Confirmed synonyms for European canker
1.
2.
3.
4.
5.
6.
7.
8.
9.
Cylindrocarpon heteronema
Cylindrocarpon mali
Dialonectria galligena
Dialonectria galligena var. major
Fusarium heteronemum
Fusarium mali
Nectria galligena var. major
Neonectria galligena
Ramularia heteronema
Australia – Apples (DS367)
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18 July 2008
Appendix 3: Weather data for Melbourne, Australia and Nelson, New
Zealand, January to April inclusive
Melbourne: daily maximum and minimum temperatures,
1 Jan 2008 to 30 Apr 2008
Temperature (degrees C)
40
30
20
10
Minimum daily temp Jan-April 2008
Maximum daily temp Jan-April 2008
0
1
21
41
61
81
101
121
Day of year
Nelson: daily maximum and minimum temperatures,
1 Jan 2004 to 30 April 2004 (wet year)
Temperature (degrees C)
30
25
20
15
10
Maximum daily temperature for 2004
5
Minimum daily temperature for 2004
0
1
11
21
31
41
51
61
71
81
91
101
111
121
Day of year
40
Melbourne rainfall (mm)
1 Jan 2008 to 30 Apr 2008
Rainfall (mm)
30
20
10
0
1
21
41
61
Day of year
81
101
121
Australia – Apples (DS367)
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18 July 2008
80
Nelson rainfall (mm)
1 Jan 30 April 2004 (wet year)
70
Rainfall (mm)
60
50
40
30
20
10
0
1
11
21
31
41
51
61
71
Day of year
81
91
101
111
121
Australia – Apples (DS367)
Australia’s First Written Submission of Australia
18 July 2008
Table 1. Percentage of days in the month with rainfall events greater or equal to 1 mm. The
Australian data is for the last 12 months and represents a dry, warm cycle. The years 2000 and
2004 are the two wettest seasons for Nelson in the last decade.
% rain Melbourne
days per
2008
month
13.3
January
41.3
February
16.1
March
30.0
April
Nelson
2000
43.3
28.5
16.1
46.7
2004
38.7
72.4
19.4
36.7
Data sources: Australian Bureau of Meteorology and the National Climate Database, New
Zealand.